This afternoon, a jury in federal court in Manhattan found Rajat Gupta, the former CEO of consulting firm McKinsey & Company and also a former member of the Goldman Sachs board of directors, guilty on three counts of securities fraud and one count of conspiracy related to an insider trading scheme involving Raj Rajaratnam. Gupta was acquitted of two other counts of securities fraud.
Here are the key facts you need to know:
- Gupta faces a maximum of 20 years in prison on each of the fraud charges and up to five years for the conspiracy charge. He is expected to get much less than that at his sentencing, which is set for October 18. Judge Rakoff indicated that he was inclined to release Gupta on bail until sentencing.
- Gupta's lawyer, Gary Naftalis, stated after the verdict was delivered that Gupta would likely file an appeal. “This is only round one of this matter,” he said.
- Several jurors were crying as they left the courtroom. The jury's foreman stated that Gupta was "a man who came to this country and was a wonderful example of the American dream. We wanted to believe that the allegations weren't true, but at the end of the day the evidence was just overwhelming.”
- The prosecutors in the Gupta case were Reed Brodsky and Richard C. Tarlowe. Brodsky was also the lead prosecutor in the Rajaratnam case.
- Since the government crackdown on insider trading began in October 2009, the U.S. has now brought cases against 66 traders and their sources, Bloomberg reports. There have been no acquittals and six cases are still pending.