Wednesday was a big day for government prosecutors cracking down on bankers. In addition to the Bank of America lawsuit, former Goldman Sachs director Rajat K. Gupta was sentenced to two years in prison and fined $5 million for insider trading. The New York Times’ Dealbook blog wrote:
Mr. Gupta, 63, who ran the consulting firm McKinsey & Company and served as a major adviser to the philanthropic efforts of Bill Gates and Bill Clinton, is the most prominent figure to face prison in the government’s sweeping crackdown on insider trading.
Gupta tipped off his friend and associate Raj Rajaratna, a hedge fund manager, to Goldman Sachs secrets. The Wall Street Journal reports:
His tip about Berkshire Hathaway Inc.’s impending investment to shore up Goldman during the crisis was “disgusting in its implications” and “a terrible breach of trust,” said [U.S. District Judge Jed] Rakoff before he handed down the sentence. He added: “Others similarly situated to the defendant must…be made to understand that when you get caught, you will go to jail.”
Under Manhattan U.S. Attorney Preet Bharara, since 2009, 69 people have pleaded guilty to or been convicted of insider trading. Bharara was also the author of yesterday’s complaint filed against Bank of America.
Gupta was born in Kolkata, India, and came to the U.S. to study at Harvard Business School. The Dealbook blog writes that he is a “noted humanitarian,” and has “played a leading role in organizations fighting diseases like AIDS, malaria and tuberculosis in poverty-stricken nations.” Judge Rokoff said Gupta is “a good man,” but added “the history of this country and the world, I’m afraid, is full of examples of good men who do bad things.”