NEW YORK, Wed Oct 24, 2012 – The sentencing on Wednesday of fallen Wall Street titan Rajat Gupta for insider trading could come down to whether a judge agrees that his lifetime of charity counts against sending him to prison.
The former Goldman Sachs Group Inc. board member was convicted in June of leaking boardroom secrets to hedge fund manager Raj Rajaratnam, his friend and former business associate, at the height of the financial crisis.
Gupta, 63, is to be sentenced by Manhattan U.S. District Judge Jed Rakoff, who oversaw the four-week trial. The former Goldman director, who also once ran the McKinsey & Co consulting firm and sat on the boards of Procter & Gamble Co and American Airlines, is the most influential corporate figure to be convicted in the recent crackdown on insider trading.
Indian-born Gupta had moved in elite business and philanthropic circles for decades until he became ensnared in the Rajaratnam case.
Gupta’s lawyers have requested that he be spared prison, citing his work with groups such as the Bill & Melinda Gates Foundation on fighting disease in developing countries. Bill Gates, Microsoft Corp’s co-founder, and former United Nations Secretary-General Kofi Annan are among the luminaries who have urged Rakoff to be lenient.
As one alternative to prison, the defense proposed “a less orthodox” plan in which Gupta would live and work with Rwandan government officials to help fight HIV/AIDS and malaria in rural districts, court papers said.
Federal prosecutors, however, argue that Gupta should serve eight to 10 years in prison. Gupta repeatedly flouted the law and abused his position as a corporate board member, they said.