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Former Goldman Sachs director Rajat Gupta faces sentencing

October 24, 2012|By Andrew Tangel
  • Rajat Gupta speaks during the United Nations General Assembly in 2005. U.S. District Judge Jed Rakoff is scheduled to sentence him Wednesday on three counts of securities fraud and another of conspiracy. A jury convicted him in June.
Rajat Gupta speaks during the United Nations General Assembly in 2005.… (Paulo Filgueiras / United…)

NEW YORK -- Rajat Gupta, among the world's most prominent businessmen, may spend years in prison for his role in the Galleon Group insider-trading scheme.

Or, Gupta may perform community service as punishment after a judge sentences him Wednesday on three counts of securities fraud and another of conspiracy. A jury convicted him in June.

His lawyers have proposed sentencing him to work for a homeless youth shelter in New York or in Rwanda, helping improve health care and develop agriculture in rural areas.

A slew of bold-face names have vouched for Gupta in court filings, including Microsoft co-founder Bill Gates and Kofi Annan, the former secretary general of the United Nations.

"His commitment to helping others, both individual human beings and the larger global community, is plainly a core expression of who he is -- indeed, who he has always been, from childhood through professional maturity and success, and into his retirement years," Gupta's lawyers wrote in court filings.

"Mr. Gupta’s role in helping to create, and his lifelong involvement in, organizations devoted to global health and other causes is extraordinary. The conduct for which he was convicted represents an isolated aberration and a stark departure from this personal history."

Prosecutors, meanwhile, have proposed a prison sentence of eight to 10 years, "to reflect the seriousness of Gupta’s crimes and to deter other corporate insiders in similar positions of trust from stealing corporate secrets and engaging in a crime that has become far too common," they wrote.

The sentencing, before U.S. District Judge Jed Rakoff, is part of a dark shadow cast upon a  stellar career.

Gupta became the first-ever Indian-born head of a U.S. multinational company -- the prestigious consulting firm McKinsey & Co., his lawyers said in court documents.

He also sat on high-caliber corporate boards, including those of the powerful investment bank Goldman Sachs and consumer goods giant Procter & Gamble. Gupta was convicted of illegally sharing corporate secrets with his friend Raj Rajaratnam, who headed Galleon before being sent to prison for 11 years.

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