The rise and fall of Rajat Gupta
Rajat Gupta’s memoir of his trial for insider trading is a racy account of a corporate giant’s downfall. His life comes full circle when he is imprisoned for being implicated in passing inside information to Galleon International founder Raj Rajaratnam.
Gupta’s complete immersion in America’s corporate life made him touch the ultimate height of fame and, later on, the lowest levels of ignominy. From being the managing director of McKinsey, who exemplified the American dream, and the rise of the Indian diaspora, Gupta became a prisoner for almost two years.
As with many stories of epic downfall, the path to Gupta’s trial and imprisonment was paved with good intentions. A hedge fund named Voyager was started to raise money for healthcare in India in association with Raj Rajaratnam and others.
Sadly, the more Gupta tried to tie the loose ends of his investment with Galleon, the more distant Raj and he became. Egged on by his financial advisers, whenever Gupta tried to ask Raj about the status of his investment and the state of the Voyager fund, the Galleon CEO and founder evaded him keeping the calls short and sketchy. This relationship between a disgruntled former CEO of a famous consulting firm, who tried to get clarity on the status of his investment, and a shady personality who was revered in the financial markets inevitably linked the two as unlikely allies in the eyes of the American state, according to the memoir.
A retired Gupta sat on the boards of Goldman Sachs and Procter and Gamble. The board meetings sometimes dealt with inside information, such as a planned investment by Warren Buffet’s Berkshire Hathaway, a sign of confidence in Goldman Sachs, amid the 2008 financial crisis. Gupta called Raj seconds after the meeting and confirmed the latter’s enquiry about the Berkshire investment, without giving it much thought.
This 15-second conversation would prove to be Gupta’s Waterloo. US Attorney Preet Bharara’s team pinned a buy and sell of Goldman shares by Galleon, timed to cash in on the price change after the Berkshire announcement, on this phone call. Gupta’s memoir is well-written. He reasons well, which is expected of a former McKinsey CEO.
He led a charmed life which combined intelligence, an ability to spot an opportunity and a refusal to let a second chance slide by. This is where Gupta mulls a lot about how he could have told his story during the trial, instead of taking a standard defence that the government did not have sufficient evidence of insider trading against him. He asserts that he did not gain any personal favours from insider trading. For all his philanthropic work, Gupta, ironically, got sentenced for financial greed and corporate misconduct. This memoir is important because here Gupta talks to us, Indians in a relatable way. Catharsis is just another feature of this memoir.
The crux of it is in reading about the life of a man who made it on his own at a time when the world had not woken up to India’s potential. Becoming managing director of McKinsey was the culmination of a bigger fight against perceptions that Gupta had started. And the trial and imprisonment cannot take that away from him.
MIND WITHOUT FEAR
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