Rajat Gupta, one of the most powerful executives in the US, was on Tuesday charged with insider trading by the Securities and Investment Commission. The former director of Goldman Sachs is being charged for allegedly providing a hedge fund manager secret information on the financial situation of the bank.
This has drawn Gupta into the $18 million insider trading scandal, where Galleon Group founder Raj Rajaratnam was allegedly tipped off, reaping millions of dollars on the information. According to the SEC, Gupta told Rajaratnam that Goldman was in better shape than expected, before second quarter earnings were announced in 2008, and also suggested to him that Berkshire Hathaway were investing $5 billion in the bank, before it was publicly disclosed.
The US attorneys office is prosecuting the case.
In This Story: Goldman Sachs
The Goldman Sachs Group, Inc. (NYSE: GS), is an American multinational investment bank and financial services company headquartered in New York City. It offers services in investment management, securities, asset management, prime brokerage, and securities underwriting.