Past “good deeds” helped Rajat Gupta, the one time poster boy of Indian business in America, get away with a two year prison sentence for leaking corporate secrets to former hedge fund tycoon Raj Rajaratnam.
Judge Jed S. Rakoff of the Federal District Court in Manhattan Wednesday handed down India born Gupta, 63, a former Indian-American director of Goldman Sachs Group, a more lenient prison sentence than the eight to 10 years stipulated for insider trading by nonbinding federal sentencing guidelines.
“I have never encountered a defendant whose past history suggests such an extraordinary devotion … to people in need,” Rakoff said during a two hour hearing. Yet Gupta’s past good deeds “starkly contrast with the nature and circumstances of his crimes”.
“I think the record, which the government really doesn’t dispute, bears out that he is a good man,” he said. “But the history of this country and the history of the world, I’m afraid, is full of examples of good men who do bad things.”
The judge also ordered Gupta to pay a $5 million fine and said he would face one year of supervised release after finishing his prison term. The defence plans an appeal.
Gupta, who was accompanied to court by his wife and four daughters, apologised to his friends, family and the charitable institutions that he helped found.
“The last 18 months have been the most challenging period of my life since I lost my parents as a teenager,” he told the judge before sentencing. “I lost my reputation that I built over a lifetime.
“Much of the first year seemed surreal to me. However, since the trial I’ve come to accept the reality of my life going forward”
In a statement, Manhattan’s Indian-American US attorney Preet Bharara said: “With today’s sentence, Rajat Gupta now must face the grave consequences of his crime – a term of imprisonment.”
His conduct has forever tarnished a once-sterling reputation that took years to cultivate, he said. “We hope that others who might consider breaking the securities laws will take heed from this sad occasion and choose not to follow in Gupta’s footsteps.”
Prosecutors had urged a sentence of 97 to 121 months for Gupta, who was convicted last June for insider trading on three counts of securities fraud and one count of conspiracy.
Gupta’s lawyers on the other hand had suggested he could repay for his “shocking” crimes by working for a homeless youth shelter in New York or in Rwanda, helping improve healthcare and develop agriculture in rural areas.
“The fall from grace that Mr. Gupta has suffered or experienced as a result of this matter is as steep as … I have ever seen,” Gupta’s lawyer Gary Naftalis told the court. “This was an iconic figure who had been a role model for countless people around the globe. He is no more.