Rajat Gupta 'abused his position','broke the law': Prosecution

NEW YORK: US authorities on Wednesday said there was "devastating evidence" against Rajat Gupta that he "abused his position" and "broke the law" when he tipped Raj Rajaratnam, even as the defense argued that the former Goldman Sachs director did not pocket one dishonest dime in his association with the convicted hedge fund founder.

The defense and the prosecution started presenting their closing arguments in 63-year-old Gupta's insider trading trial in the Manhattan federal court today.

The prosecution summarises for the jury through e-mails, phone records and trading records that Gupta had passed secret information to Rajaratnam about Goldman Sachs and Procter & Gamble.

Gupta's lawyer Gary Naftalis argued that Gupta had no motive to share insider information with Rajaratnam as he was frustrated and upset with him about his USD 10 million loss in an investment fund parked with the founder of Galleon group.

"It is undisputable that Gupta never did any insider trading. No dishonest dime ended up in Gupta's pocket," Naftalis said.

Naftalis said Gupta was planning to resign from Goldman Sachs as board member around September 12, 2008 and so he could not had any motive to tip Rajaratnam about a USD 5 billion investment Warren Buffett was planning to make in Goldman Sachs.

He further said Gupta had a conversation with his eldest daughter around September 20, 2008 that he was stressed, frustrated and upset with Rajaratnam about his USD 10 million loss.

"In this context the claim by the prosecution that Gupta tipped Rajaratnam on September 23, 2008 defies all sense of realities and commonsense," the defense lawyer said. If convicted Gupta, who served on boards of various companies, faces up to 25 years in prison.