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Former Goldman Sachs director convicted in NYC

Jun 15, 2012 11:53 PM

The Associated Press


Former Goldman Sachs director Rajat Gupta, left, and his attorney Gary P. Naftalis, leave federal court in New York, Friday, June 15, 2012. Gupta, accused of feeding confidential information to a corrupt hedge fund manager, has been convicted of conspiracy and three counts of securities fraud. (AP Photo/Richard Drew)

By TOM HAYS Associated Press

NEW YORK (AP) — Former Goldman Sachs board member Rajat Gupta lived the American Dream before being led astray by a wealthy friend who was a master at insider trading.

That was the view of two jurors who on Friday voted with 10 others to convict Gupta of three counts of securities fraud and one count of conspiracy for sharing corporate secrets with hedge fund manager Raj Rajaratnam.

With the verdict, Gupta became the most prominent defendant convicted so far in a wide-ranging Wall Street inquiry conducted by investigators armed with wiretaps.

Prosecutors had alleged that Gupta’s tips gave Rajaratnam an edge over ordinary investors on trades of more than 350,000 shares of Goldman stock in 2008.

Rajaratnam, the billionaire founder of the Galleon hedge fund firm who was convicted last year, ‘‘was a very manipulative man,’’ juror Rick Lebkowski said after the verdict. ‘‘He made it very easy for Mr. Gupta to give him this information.’’

Recordings of Rajaratnam and Gupta casually chatting on the phone convinced juror Ronnie Sesso that Rajaratnam ‘‘was a savvy and sneaky man. ... He was a little snake in the grass.’’



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