Jurors weighing the insider-trade case against Raj Rajaratnam in Manhattan Federal Court hear lot about Rajat Gupta, former head of McKinsey. They listened to a wiretap on which he confided to Rajaratnam that the Board of Goldman Sachs (GS), on which he was seated, discussed acquiring Wachovia or American International Group (AIG). They watched Chief Executive Officer of Goldman Sachs, Lloyd Blankfein testify that Gupta breached code of ethics of the company for administrators. Prosecutors have called Gupta, who appeared as a witness, a sponsors of conspiracy with the Securities and Exchange Commission filed an administrative appeal against him for his alleged involvement in the scandal. Yet, nothing explains why Gupta, once one of the advisors of confidence of the business world, would risk his reputation by sharing confidential information with a hedge fund manager.
Gupta, 62, led McKinsey, the global consulting firm, from 1994 to 2003. He has served on the Board of Directors of some of the largest multinational companies, including Goldman Sachs and Procter & Gamble. He raised millions for charity, hung with the Prime Minister of the India and first state dinner attended President Barack Obama in the White House. He shares his time between a waterfront area in Westport, Conn., owned by J.C. Penney, a Manhattan apartment and a Florida getaway.
But Gupta had grander ambitions. After resign from employment higher than McKinsey, he pursued a second career as a dealmaker. Human, CEO turned to his judgment expertise and sound made questionable decisions as it has invested with Rajaratnam, co-founder of the hedge fund Galleon group. The SEC accused of transmission of information confidential to P & G and Goldman Sachs and Warren Buffett Goldman Sachs $ 5 billion investment gains. These tips generated more than 17 million of illicit profits or avoid loss of Galleon, the SEC said. Lawyer Gupta, Gary Naftalis, called the allegations "totally unfounded."
The son of a man who fought for the independence of the India, Gupta was orphaned at adolescence. He worked his way from the roots of middle-lower Kolkata class at Harvard Business School and joined McKinsey in 1973. His big break came in 1994 when McKinsey organized elections for a new leader. Gupta won over two other candidates, becoming the first Director General non - U.S. - born of the firm. He served for three terms of three years, the maximum under the rules of McKinsey.
Gupta remained at McKinsey as senior partner until 2007. Then, the financial markets are booming, and private hedge fund managers were new elite of New York. He had been advised by many CEOs were positions in the nonprofit world. Imagined Gupta that he could take advantage of its own contacts and add to its wealth, says a senior to a society where Gupta was a Director until March. He loved the collection of rumours of Wall Street and analyze his Professorial manner, said the Executive. He loved the idea of making transactions 8 or 10 per year - making introductions among managers and investors and leaving mathematics and paperwork for the others, says the Executive, who did not want to be named because his conversations with Gupta were deprived. This is also how Rajaratnam saw him. "Your value added is not to make cash flow," Rajaratnam said Gupta in a July 2008 wiretapped telephone conversation before the trial. "Your value added is to bring people together, transactions, at the right time to make the call."
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