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Gupta Faces New Insider Trading Charges
April 17, 2012
[ by Melanie Gretchen ]
Rajat Gupta, former director of Goldman Sachs and Procter & Gamble, and former global head of McKinsey & Company consultants, was already facing charges that he leaked insider information to convicted Galleon hedge fund manager, Raj Rajatanam. He now faces a new insider trading claim.
Government Findings and Allegations. Federal prosecutors filed a new insider trading claim against Mr. Gupta, 63, accusing him of leaking to Rajaratnam secret corporate information about Procter & Gamble - specifically organic sales growth forecasts for P&G for the 4th quarter of 2008 prior to the company's public announcement on or about 12/11/08. The claim was submitted by letter to presiding Judge Jed Rakoff on Monday.
Mr. Gupta is the most prominent business executive 'caught' by the Justice Department in its sprawling insider trading investigation on Wall Street and in corporate America. With Monday’s new charge, the government now has 5 separate illegal tips that it claims Gupta passed along to Rajaratnam, including advance word about Warren E. Buffett’s $5 billion investment in Goldman during the financial crisis.
The government said that the new accusation involving Procter & Gamble was based in part on IMs and emails that prosecutors reviewed last week as part of the pretrial discovery process. Mr. Gupta’s trial is scheduled to begin 5/21/12 in Federal District Court in Manhattan.
Gupta's lead attorney, Gary Naftalis, has said his client is innocent of all charges and has called the government’s charges “totally baseless.”
For further details, go to [Dealbook, 4/16/12].
eaking to Mr. Rajaratnam sales forecasts for Procter & Gamble in late 2008.

