'There were mistakes, but I am not an insider trader,' says Rajat Gupta, former head of McKinsey & Co

Gupta, a graduate from Indian Institute of Technology (IIT), Delhi and Harvard Business School, was the first ever Indian-born CEO of McKinsey.

FP Staff March 25, 2019 14:27:58 IST
'There were mistakes, but I am not an insider trader,' says Rajat Gupta, former head of McKinsey & Co
  • Rajat Gupta, former head of McKinsey & Co has revealed his story of his fall from grace in his memoir Mind Without Fear to be published next week

  • The memoirs, he says, is telling his side of the story 'in my own voice and what I went through and how I see the facts as I see them and I narrate them,

  • Gupta, a graduate from Indian Institute of Technology (IIT), Delhi and Harvard Business School, was the first ever Indian-born CEO of McKinsey.

Rajat Gupta, former head of McKinsey & Co has revealed the story of his fall from grace in his memoir Mind Without Fear to be published next week. In a slew of interviews to the media, Gupta has reiterated that he has not written the book to 'defend' himself or to 'relitigate' the case.

The memoir, he says, tells his side of the story 'in my own voice and what I went through and how I see the facts as I see them and I narrate them," he said, to CNBC-TV18

In 2012,  a Manhattan federal jury found Gupta guilty of feeding tips about Goldman Sachs at the height of the 2008 financial crisis to hedge fund tycoon Raj Rajaratnam, his friend and business associate.

Gupta in a slew of interviews to the media clarifies his side of the story. He emphatically denies sharing any insider information with Rajaratanam. "If you read all the court proceedings, it was more circumstantial," he said in an interview to Livemint.

There were mistakes but I am not an insider trader says Rajat Gupta former head of McKinsey  Co

Rajat Gupta, former managing director, Mckinsey &Company. AFP PHOTO/

In fact, Judge Jed Rakoff, the man who sentenced Rajat Gupta to a "lenient" two years in prison made a pointed reference to the fact that even in the US, sentencing on insider trading is not based on the theory that someone made a loss or gain due to the actions of an insider (read the highlights of his judgment here).

He said in his judgment: "While insider trading may work a huge unfairness on innocent investors, Congress has never treated it as a fraud on investors, the Securities Exchange Commission has explicitly opposed any such legislation, and the Supreme Court has rejected any attempt to extend coverage of the securities fraud laws on such a theory...".

Gupta says he thought the loss of reputation would hurt him a lot but strangely it wasn't much, he said in an interview to The Hindu. He rues though that the loss of reputation would put stop to many things he could do [raise money for charity]. "You know, the reputational loss hurt less than I thought it would. I thought it would hurt a lot more, but it didn’t. There are certain things I doubt I could do now because of the reputational loss," he was quoted as saying by the newspaper.

Gupta, a graduate from Indian Institute of Technology (IIT), Delhi and Harvard Business School,  was the first ever Indian-born CEO of McKinsey. He is also a former director, Goldman Sachs Group Inc and served on the board of Procter and Gamble and been an adviser to the executive leadership of the Bill and Melinda Gates Foundation.

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