A former Goldman Sachs and Procter & Gamble Co. board member once widely respected for his business smarts has been sentenced to 2 years in prison for insider trading.
Rajat Gupta was sentenced Wednesday in New York. He also was fined $5 million by U.S. District Court Judge Jed Rakoff.
At the sentencing, the 63-year-old Gupta said the last 18 months had been the most challenging period of his life since the loss of his parents. "I regret terribly the impact of this matter on my family, my friends and the institutions that are dear to me. I've lost my reputation I built for a lifetime. The verdict was devastating," he said.
Manhattan U.S. Attorney Preet Bharara said Gupta's actions has tarnished his "once sterling" reputation. "We hope that others who might consider breaking the securities laws will take heed from this sad occasion and choose not to follow in Mr. Gupta's footsteps," Bharara said in a statement.
Prosecutors had asked that Gupta be sentenced to up to 10 years in prison after he was convicted of feeding inside stock tips to a billionaire hedge fund founder, Sri Lanka-born Raj Rajaratnam. The one-time billionaire hedge fund boss controlled up to $7 billion in accounts, giving him a firm footprint in the financial markets and influence that impressed someone as widely regarded as Gupta.
Rajaratnam is serving an 11-year prison sentence after his conviction at trial last year.
Defense lawyers argued that Gupta's long history of community service and good deeds warranted probation.
Read the sentencing memorandum issued by U.S. District Judge Jed S. Rakoff below: