Dear Member/s,
This is not good news, information article (that
I normally share) that I would want to send it out to all. Nevertheless,
nothing will stop it – this will be on every media websites, blogs,
newspapers/publications, TV News you name it with everyone from politicians
(both placed India, US) to business titans (globally) to analysts and finally
ordinary individuals (incl. me) will be talking on justice or rather injustice
that has happened in Mr Rajat Gupta case. Legal eagles will continue to scout
around for some or the other loop-holes etc.. to save the day (rather face) and
of-course Mr Gupta.
Keep aside law, business,
relationships..etc..etc; The Truth is very simple – Mr Gupta slipped up
heavily on “Ethics and Moral” part and this is to say in legal parlance “beyond
a reasonable doubt” as described by Judge in-spite of all his good deeds and
contributions till date.
The other thing that will be remembered in this
lawsuit will be that - in far of land it was and Indian who brought down
another Indian although they may be US citizens.
(P.S. – These views are personal)
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(Source: The Wall Street Journal)
Rajat Gupta's impending journey into the federal
prison system for criminal insider trading ends a remarkable success story and
punctuates his swift fall from grace.
A native of Kolkata, Mr Gupta, 63 years old,
moved at a young age to New Delhi. His father, Ashwini, a disciple of Mohandas
Gandhi, was jailed for years in the fight for independence from the British and
later was a journalist. His mother, Pran, was a Montessori schoolteacher and
principal.
Both died by the time he was in his teens, his
father of tuberculosis contracted in an Indian prison, according to one of Mr
Gupta's daughters. Still, Mr Gupta thrived both academically and as an anchor
for his family. He studied engineering at the Indian Institute of Technology in
New Delhi, where he was a "a big man on campus, bright, talented,
popular," and head of student government, according to his wife, Anita,
who met him there taking part in a one-act play in 1968. He wrote his essays to
apply to Harvard Business School in a local coffee shop.
"It seemed like such a dream," Anita
Gupta wrote in a letter last month to the judge who sentenced him Wednesday for
giving a hedge-fund manager inside information about Goldman Sachs Group Inc.,
where he was a director. Mr Gupta agonized when he was accepted to Harvard about
leaving his siblings, his wife added, but "decided it was an opportunity
he could not afford to miss."
He came to the U.S. in 1971, delivering
newspapers at Harvard to help support himself. Two years later, in New York, he
broke into McKinsey & Co., a top-tier consulting firm for America's most
powerful corporations, and rose through the ranks. At 45, in 1994, Mr Gupta
became the first Indian-born chief of a U.S. international corporation. He
served in that role until 2003.
Besides breaking ground in the U.S., Mr Gupta's
success inspired people in his home country. McKinsey was one of a few global
companies in which many Indians made their careers, but Mr Gupta blazed the
trail for other Indians who joined the small club of multinational CEOs, including
former Citigroup Inc. Chief Executive Vikram Pandit and PepsiCo Inc. Chairman
Indra Nooyi.
He routinely visited India and maintained close
ties with senior business leaders in India and was consulted by the Indian
government on policy issues.
"He was a hero from an Indian
perspective," said Richard Rekhy, head of advisory services for consulting
firm KPMG in India.
Mr Gupta lived in Chicago for a time and
eventually moved to Connecticut, where he and his wife live in Westport, on the
Long Island Sound. They have four daughters and two grandchildren.
Having the ears of corporate chieftains, Mr
Gupta became active in philanthropic and academic endeavours, serving in
advisory roles at Harvard and the Kellogg School of Management. Mr Gupta worked
with former President Bill Clinton in leadership roles at the American India
Foundation and as chairman of the Global Fund to Fight AIDS, Tuberculosis and
Malaria.
He was viewed as a master networker,
establishing relationships through his philanthropy with Mr Clinton, Microsoft
Corp. co-founder Bill Gates and Hank Paulson, the former Goldman CEO and
Treasury Department secretary. Mr Gupta and his wife were among the list of
invited attendees to President Barack Obama's first state dinner, according to
a list released by the White House.
It was through the creation of the Indian School
of Business in Hyderabad in the late 1990s that Mr Gupta met the man who would
help bring about his downfall. A mutual friend, Anil Kumar, asked for donations
from Raj Rajaratnam, founder of the Galleon Group hedge fund, who pledged $1
million, according to testimony at Mr Gupta's trial. Mr Rajaratnam was
convicted of insider trading last year and sentenced to 11 years in prison.
Mr Kumar, who was Mr Gupta's protégé at
McKinsey, pleaded guilty to giving the Galleon chief unrelated tips, testified
at both men's trials and recently received a sentence of probation.
Messrs’ Rajaratnam and Gupta became friends. The
ability to cultivate contacts, along with their South Asian heritage, was a
quality Mr Gupta shared with the 55-year-old Mr Rajaratnam, a Sri Lankan
native.
Messrs’ Gupta and Rajaratnam had vastly
different personal styles. The square-jawed Mr Gupta was quiet and
distinguished; Mr Rajaratnam was rougher around the edges and enjoyed practical
jokes, people who know them said. Though Mr Gupta had a more public persona,
the billionaire Mr Rajaratnam was far richer.
Mr Gupta often would have lunch with Mr
Rajaratnam in the hedge-fund manager's office, ordering Indian or Chinese food.
Starting around 2003, he and Mr Rajaratnam began
investing millions of dollars together, according to court documents from his
trial, both in vehicles related to Galleon and in an Asia-focused
private-equity fund Mr Gupta had helped to start.
In the ensuing years, Mr Gupta leaked Mr
Rajaratnam inside information, both because of their friendship and business
dealings, prosecutors said.
They said Mr Gupta became a "secret
pipeline" to Mr Rajaratnam from 2007 until early 2009 for inside
information on the boards of Goldman and Procter & Gamble Co. He provided
advance tips about, among other things, a $5 billion investment in Goldman by
Warren Buffett's Berkshire Hathaway Inc. at the height of the financial crisis
and the investment bank's first quarterly loss as a public company, the
government said.
After the conviction of Mr Rajaratnam in May
2011, friends said, Mr Gupta seemed worried and nervous about his own future.
"He was distraught. He seemed upset," Anand "Bill" Julka, a
childhood friend, previously told The Wall Street Journal.
Six months later, Mr Gupta was indicted,
surrendering to federal agents. He decided to go to trial instead of pleading
guilty as many other defendants have, hoping to beat back the largely
circumstantial case, sitting straight-backed through the month long
proceedings, his wife and daughters right behind him. Unlike in the case against
Mr Rajaratnam, prosecutors had only one substantive wiretapped phone call of Mr
Gupta and pieced together the case through phone and trading records.
Mr Gupta's lawyer, Gary Naftalis, told the
jurors who convicted him on four of six counts that Mr Gupta had no idea about
Mr Rajaratnam's "secret world" of insider trading and argued
unsuccessfully that a falling out over a failed investment had negated his
motive to leak. Nor did he personally trade on inside information, although
prosecutors said he benefited from his business relationships with Mr
Rajaratnam.
Mr Gupta, despite his desire to testify in his
own defense, took his lawyers' advice and remained silent. Jurors, some of them
shedding tears, ultimately convicted him on three counts of securities fraud
and one count of conspiracy. He was acquitted of two counts of securities
fraud, including the only one relating to P&G.
"We wanted him to walk, go home to his
family, live a very prosperous life," juror Ronnie Sesso, a 53-year-old
youth advocate in New York, said in an interview after the verdict. "I
struggled with everything…but looking at the evidence made it clear."
Since then, Mr Gupta has spent time trying to
console his family, helping one daughter rearrange her Boston home. His lawyers
sent more than 400 letters seeking leniency to District Judge Jed Rakoff, from
the likes of Mr Gates, former U.N. Secretary-General Kofi Annan, and many
others. Mr Kumar's 25-year-old-son, Aman, who had called Mr Gupta "Rajat
uncle" growing up, wrote one, too.
"Often these days, I see my father and
notice an unfamiliar look of fear on his face," wrote his daughter Megha.
"I'll put my arm on his shoulder and say, 'Don't worry, Baba.' He moves
quickly to compose himself: 'I'll be all right, baby. Are you all right?'
"
