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Rakoff Sentenced Gupta (Insider Trading) Without 'Thinking Out-of-the-Box'
[ by Melanie Gretchen ]
Most respondents to the NYPost poll were hoping that Rajat Gupta would be sentenced to 6 or more years in prison. The prosecution sought the max penalty - 10 years in prison - while defense counsel recommended no prison time, but 2 years of comprehensive community services in New York or Rwanda helping severely disadvantaged children in either location. This was suggested because Gupta had unique knowledge and experience, gleaned his many years that ranged from his many years as an orphaned immigrant from India to his crowning achievements in business as Chief Executive for the world' pre-eminent consulting firm.
Federal Judge Jed Rakoff instead sentenced Gupta to 2 years in prison, and fined him $5 million. He said his ordered sentence factored Mr. Gupta's past value to business and philanthropic history. Yet, he felt obliged to order some time in prison because, as he said, the courts are full of good people who have broker the law, and it's not feasible or appropriate to grant each of then a suspended sentence.
Out-of-the-Box Thinking. While the 2-year prison sentence and $5 million fine appear appropriate - though a heavier sentenced would not have been inappropriate, either - the Judge failed to take advantage of Mr. Gupta's skills and compassion in the sentence. He'll will have little opportunity to advance others during his 2-year stay in prison.
That's where an "Out-of-the-box" sentence - as recommending by a Reuters Breakingviews columnist - might have been more appropriate. One thought would have been to retain the 2-year prison term and $5mn fine, while further requiring Mr. Gupta to serve 2 years providing Community Service, as well.
Win-Win Situation. For one thing, such a sentencing would have increased Mr. Gupta period of "incarceration" - to the likely approval of the Masses," and made some constructive use of Gupta's skillsets that would have enabled Mr. Gupta to reinvigorate his ethics and concern for doing the right thing in and for socieity, while providing impoverished Rwandans (or U.S. citizens) with much needed assistance.
Alas, that won't happen and Gupta will go 2 years and out - and his years of knowledge and experience, gleaned from a life spent rising from an orphaned immigrant from India to a corporate king, will go to waste.
Perhaps this lesson will be remembered in future cases.
For further details, go to [Reuters Breakingviews, 10/25/12].

