Rajat Gupta surrendered Wednesday morning to Federal Bureau of Investigation officials over charges of insider trading reports the New York Times. According to the Wall Street Journal, “Mr. Gupta is currently in custody and being processed.”
Rajat Gupta is Arrested
The Washington Post writes, “Mr. Gupta, the former head of global consulting firm McKinsey & Co., was under investigation over whether he gave inside information to former hedge-fund titan Raj Rajaratnam, who was sentenced earlier this month to serve 11 years in prison for insider trading.” Gary Naftalis, Gupta’s lawyer commented, Gupta “is innocent and has always acted with honesty and integrity.” Naftalis continued by stating that Gupta “did not trade in any securities, did not tip Mr. Rajaratnam so he could trade, and did not share in any profits as part of any quid pro quo.” Specific details of the criminal charges were not available.
SEC Investigates Galleon Group
Rajat Gupta is the latest person to be charged in the Galleon Group investigation. The inquiry began five years ago. Since then, more than two dozen people have been charged for insider trading, specifically for “swapping illegal tips around company earnings and other major corporate events.” The New York Times notes of Gupta’s arrest, “While the majority of those charged have been traders and analysts on Wall Street, Mr. Gupta, 62, is the first to be implicated from the upper echelons of corporate America.” The Washington Post notes, “According to evidence presented at Mr. Rajaratnam’s trial, Mr. Gupta called him within minutes of learning confidential details at Goldman board meetings.”