'Rajat Gupta should pay $15 mn penalty'
US government has asked a court here to slap a maximum penalty of USD 15 million on India-born fallen Wall Street titan Rajat Gupta and permanently bar him from serving as director of any publicly-traded firm for his "terrible breach of trust" by indulging in insider trading.
Weeks after the former Goldman Sachs Director was handed down a two-year jail term and fined USD five million by US District Judge Jed Rakoff, the US Securities and Exchange Commission (SEC) said he should be ordered to pay a maximum civil penalty of USD 15 million, which would be thrice the USD five million in gains and losses avoided as a result of his "illegal conduct."
Gupta, 63, who is set to begin his prison term in January, has filed an appeal against his conviction in the US Court of Appeals for the Second Circuit.
According to the Notice of Appeal filed by his lawyer Gary Naftalis in US District Court Southern District of New York, Gupta's "appeal concerns conviction only." Apart from the criminal case filed against him by Manhattan's India-born federal prosecutor Preet Bharara, Gupta faces charges filed by the SEC of "abusing his position of trust" and passing confidential information about Goldman Sachs and Proctor and Gamble to now-jailed hedge fund founder Raj Rajaratnam.
"The court should impose the maximum three-time civil penalty of 15,096,585 dollars to punish Gupta for his terrible breach of trust and his craven, criminal conduct and to deter others from engaging in such conduct in the future," the SEC said in a motion filed in federal court here.
The Commission has also sought an order permanently enjoining Gupta from future violations of the federal securities laws, barring him from serving as an officer or director of any publicly-traded company, barring him from associating with any broker, dealer or investment adviser and disgorgement of all ill-gotten gains received as a result of his illegal actions.
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