New York (IANS): Goldman Sachs’ former India-born director Rajat Gupta failed to get his insider-trading conviction tossed on the ground that he did not benefit from the alleged tips after a judge ruled it was “too little, too late”.
Manhattan federal Judge Jed Rakoff on Thursday rejected Gupta’s appeal to have his 2012 conviction overturned, saying a recent appeals court decision did not affect tippers like him, the New York Post reported.
Gupta and Galleon Group founder Raj Rajaratnam, to whom Gupta was accused of passing illegal tips about Goldman Sachs “were close business associates with a considerable history of exchanging financial favours”, Rakoff noted.
He had appealed against his conviction after an appeals court threw out two insider-trading convictions because the government had not proved that the people who gave the tips had received a financial benefit.
Gupta is serving a two-year sentence at a prison in Massachusetts and is reportedly scheduled for a March 2016 release.
In 2008, Gupta had been named chairman of Galleon International, Rajaratnam’s $1.1 billion hedge-fund firm, in which he had a 15 percent stake.
While a Goldman director, Gupta told Rajaratnam that Warren Buffett planned to invest $5 million in the bank during the financial crisis, then later leaked information that Goldman would post a fourth-quarter loss.
That information provided a “potential pecuniary benefit” to Gupta because of his investments in Galleon, Rakoff said, according to the Post.
Rajaratnam has also asked the court to throw out his conviction based on the same appeals court decision.