Friday, 23/6/2017 | 10:34 UTC+3

Sign up for Newsletter

Rajat Gupta, Raj Rajaratnam seek to overturn penalties for insider trading convictions

Gupta is serving a 2-year prison sentence.

By Raif Karerat

WASHINGTON, DC: Galleon Group hedge fund founder Raj Rajaratnam and former Goldman Sachs Group director Rajat Gupta are both looking to overturn the insider trading decisions that led to significant fines and prison sentences  for both men, citing a recent U.S. court decision that altered the definition of the offense.

The two men are the highest-profile offenders convicted during a 2009 federal crackdown on insider trading that primarily focused on hedge funds.

Rajaratnam, who is currently serving an 11-year jail term, is attempting to void the $92.8 million fine imposed on him by the U.S. Securities and Exchange Commission civil case, while Gupta is seeking to overturn his criminal conviction altogether in an effort to curtail his two-year prison sentence.

Rajaratnam, 57, was convicted of fraud and conspiracy that generated $63.8 million of illegal profit, while Gupta, 66, was charged with passing tips to Rajaratnam about Goldman’s financial results and specifically an investment from Warren Buffett’s holding company, Berkshire Hathaway.

In order to alleviate their court-ordered penalties, the two men are citing a December 10 ruling by the 2nd U.S. Circuit Court of Appeals in New York that overturned two different insider trading convictions.

That court determined insider trading required knowledge that insiders who passed confidential tips did so in exchange for personal benefits “of some consequence,” according to a Reuters report.

In a new filing with the 2nd Circuit, Rajaratnam stated his criminal case and consequent SEC penalty pertained to several transactions in which he “had no knowledge of a benefit conferred upon the tipper.”

Meanwhile, Gupta’s defense attorney adamantly claimed that jurors never found that his tips were “part of an agreed upon exchange of tips for consequential benefits, resulting in his conviction for conduct that is not a crime.”

About

POST YOUR COMMENTS

Your email address will not be published. Required fields are marked *


Warning: require_once(/homepages/30/d221447157/htdocs/GIN_NEW/wp-content/themes/news-maxx-1.0.1/footer.php): failed to open stream: Permission denied in /homepages/30/d221447157/htdocs/GIN_NEW/wp-includes/template.php on line 684

Fatal error: require_once(): Failed opening required '/homepages/30/d221447157/htdocs/GIN_NEW/wp-content/themes/news-maxx-1.0.1/footer.php' (include_path='.:/usr/lib/php5.6') in /homepages/30/d221447157/htdocs/GIN_NEW/wp-includes/template.php on line 684