Convicted Rajat Gupta ordered to pay $6.2-m to Goldman
26 February 2013
A US federal judge on Monday ordered Rajat K Gupta, the former director of Goldman Sachs convicted in an insider trading case, to pay Goldman over $6.2 million for legal expenses connected to his insider trading case.
Last May, a jury convicted Gupta, 64, for leaking boardroom secrets about Goldman to hedge fund Galleon's promoter Raj Rajaratnam. The presiding judge, Jed S Rakoff, sentenced Gupta to two years in prison. He is free on bail while he is appealing the conviction.
Judge Rakoff passed Monday's ruling in response to a claim filed by Goldman under a law that allows corporations to get reimbursed as a victim of an insider trading crime by a rogue employee.
"Goldman Sachs has proved by a preponderance of the evidence that 90 per cent of its tendered expenses were both necessary and incurred during its participating in the investigation and prosecution," Rakoff ruled.
After reviewing the firm's 542 pages of billing records, he wrote that Gupta raised no "colourable challenge to the veracity of the records."
Galleon's Rajaratnam, convicted of insider trading in 2011, is serving an 11-year prison sentence.
Michael Duvally, a Goldman spokesman, said the bank was pleased the court ordered Gupta to pay it restitution.
The money that Gupta now has to pay Goldman is separate from the cost of Gupta's legal defence, which has thus far exceeded $30 million, according to The New York Times.