US prosecutors claimed their biggest scalp in the crackdown on insider trading with the conviction yesterday of Rajat Gupta, the former Goldman Sachs director and ex-head of McKinsey Co.
A jury of eight women and four men convicted Gupta of conspiracy and three counts of securities fraud related to trading in Goldman stock by Raj Rajaratnam’s Galleon hedge fund.
They found that Gupta had told Rajaratnam that Warren Buffett was investing $5 billion in the bank, and that the bank was losing money for the November 2008 quarter.
The conviction of Gupta is the latest victory for prosecutors in the most wide-ranging Wall Street trading scandal since Ivan Boesky was jailed in 1987. The government’s latest insider trading sweep has snared about 60 people.
Gupta (63) rose to global prominence as the managing director of the powerful management consultancy, making him one of the most well-connected figures in the corporate world. – ( Copyright The Financial Times Ltd 2012)
