Until accused of sharing confidential information with hedge fund manager Raj Rajaratnam, the Kolkata born Rajat Gupta was the blue eyed boy, the self-built celebrity who was the role model for students in general and particularly Indians students all across the world in top B-Schools.
Rajat Gupta was born to a journalist father with the Ananda Bazar Patrika Group who was also a prominent freedom fighter and had been even jailed by the British. A Modern School, New Delhi alumnus Gupta did Mechanical Engineering from the Indian Institute of Technology, Delhi. He went on to pursue MBA from Harvard Business School in 1973, where he was named a Baker Scholar.
Gupta started his career with management consultancy McKinsey & Company in 1973 as one of the earliest Indian-Americans to work at consultancy and went on to serve the company for 34 long years. Gupta rose rapidly at the consulting firm, making his mark running its Scandinavian office. He expanded McKinsey’s presence in that region once considered a backwater at the firm.
In 1994, at the age of 45, his partners elected him to run the firm. He was the first non-US-born executive to run McKinsey.
Under his tenure, McKinsey expanded its global reach, aggressively moving into emerging markets like India and China. Though his reign was not without controversy. McKinsey began helping dot-coms cut deals and develop their businesses which was not the core business of the company.
Nearly a decade of Gupta’s tenure with McKinsey was as the managing director (chief executive officer) of the company. He stepped down as managing director in 2003 and retired from active practice in 2007, becoming, like other retired senior partners, a “senior partner emeritus.”
Gupta served on the board of directors or advisors of Goldman Sachs, Procter and Gamble, AMR Corporation, American Airlines Inc., Harman International, International Chamber of Commerce. He was special advisor to the Secretary-General of the United Nations educational institutions: Harvard Business School, Indian School of Business, IIT, Xinhua University, MIT Sloan, Kellogg School of Management. He also served on the board of charitable organizations like Gates Foundation, American India Foundation and health organizations Global Fund for AIDS, Malaria, and Tuberculosis, Global Health Council, Harvard School of Public Health, Cornell Medical College.
While he was managing director at McKinsey Gupta co-founded the Indian School of Business (ISB). The school was ranked number 13 in the world by The Financial Times in its “Global MBA Rankings 2011″.
What an illustrious career! And that was the reason Rajat Gupta has been a role model of millions of students and entrepreneurs. He was deserving to be called one of the world’s most prominent Indian-born business executives.
On Wednesday, federal prosecutors in the US said Gupta had tried to make other people successful, illegally. Gupta, 62, a former director of Goldman Sachs, stands accused of securities fraud and leaking corporate secrets about the bank to his friend Raj Rajaratnam, the head of the Galleon Group hedge fund. Rajaratnam was sentenced to 11 years in prison this month for orchestrating a huge insider trading conspiracy, the New York Times reported.
Rajat Gupta pleaded not guilty to all charges and was released on Thursday on a $10 million bond. The bond was secured by his home in Connecticut.
Gupta, who surrendered earlier before the FBI, was indicted on six counts of securities fraud which includes sharing confidential information about investments at Goldman Sachs with hedge fund manager Raj Rajaratnam. He faces a maximum penalty of five years in prison on the conspiracy charge and 20 years in prison on each of the securities fraud charges. In addition, Gupta faces a maximum fine of USD 250,000 or twice the gross gain or loss accrued from the crime. For each of the securities fraud charges, Gupta also faces a maximum fine of USD 5 million or twice the gross gain or loss derived from the crime.
(With inputs from Wikipedia, the New York Times and PTI)