Rajat Gupta, the devastated former Goldman Sachs director who was sentenced on Oct. 24, 2012 for insider trading crimes, said he has lost his reputation built over a lifetime and apologized to his family and colleagues.
Making his first statement since being charged with insider trading over a year ago, Gupta, 63, read from a prepared statement for six minutes before being sentenced by U.S. District Judge Jed Rakoff to two years in prison on securities fraud and conspiracy in federal court here.
"The last 18 months have been the most challenging period of my life since I lost my parents as a teenager. I have lost my reputation that I have built over a lifetime," Gupta said in a tone that did not betray any emotions.
Standing before the judge for his sentencing, the Indian American executive said, "The overwhelming feelings in my heart are of acceptance of what has happened, of gratitude to my family and friends, and of seeking forgiveness from them all. It is with these feelings that I hope to move forward and dedicate myself to the service of others."
Gupta said his conviction on insider trading charges by a jury in June this year was "devastating" to him as well as to his friends and family and added that the implications of the verdict to all aspects of his life — personal, professional and financial — have been "profound."
"Much of the first year seemed surreal to me, however, since the trial, I have come to accept the reality of my life going forward. I want to say here that I regret terribly the impact of this matter on my family, my friends and the institutions that are dear to me," Gupta said.
Gupta has been ordered to pay a $5 million fine and would have to surrender in prison on Jan. 8 next year. He will also have to undergo a year of supervised release after his prison term ends. He had not testified at his trial in June this year and neither had he spoken to the media.
Gupta, however, stopped short of taking responsibility for his conviction or admitting his conduct in his statement. He apologized to the institutions he had worked with over the course of his career, including McKinsey, which he said had to deal with negative publicity because of his insider trading case.
"I spent my entire professional career at McKinsey. It is a close-knit, values driven partnership, known for the highest standards of integrity, for always keeping client confidences, for always acting in the client's best interest.
"I am extremely sorry for the negative comments from clients and the press that McKinsey has had to deal with. I take some comfort that, given the strength of the firm, I hope that it will not suffer any long-term reputational harm," he said.
Gupta said during the course of the legal case, he has thought about the institutions and people he had worked with and mentored and feels "terrible" that they had to deal with "undeserved" negative attention. "I had the privilege of touching many lives in many fields. I mentored many young people, and many more view me as a role model. I served on many boards and many advisory positions with institutions that I hold in the highest regard.
"I have given a lot of thought to them during these last 18 months. These are extraordinary institutions and outstanding people, and I feel terrible that they have been burdened with totally undeserved negative attention. I apologize to them and ask for their forgiveness."
The IIT and Harvard educated Kolkata native said he also often thought about three not-for-profit organizations — the Indian School of Business, the Public Health Foundation of India, the America India Foundation — which he had helped create.
"These are very young institutions and in the early years of developing a reputation. I love these institutions as if they were my own children. I never want to hurt them in any way.
"Most importantly, I regret terribly any potential damage to their outstanding reputations," Gupta said.
Expressing gratitude for the support his friends have shown him so far, Gupta said he feels responsible for the "sense of loss" they have endured as "a result of what has happened."
Gupta said the events of the last one year have been devastating for his "large, extended close family" and he feels he has let his family down due to his criminal case.
"My family has always meant the world to me. My brother, sisters, in-laws, nephews and nieces have all surrounded me in these 18 months to comfort me and to give me courage. Every time I look at their faces, I get overcome with a deep sense of letting them down."
He said he and his wife Anita, whom he had met at IIT Delhi, have brought up their four daughters with the values of honesty, integrity and hard work.
"It is unbearable to me to see how much they have suffered. I just feel terribly that I have put them through this," he said.
Biography of Rajat Gupta
Rajat Gupta was born in Maniktala, Calcutta on December 2, 1948. His parents were Ashwini Kumar Gupta and Pran Kumari Gupta, who had three other children. His father was a journalist with the Ananda Bazar Patrika Group. He was a prominent freedom fighter and had been to jail many times. His mother taught at a Montessori school. When Rajat was five the family moved to Delhi, where his father went to start Hindustan Standard. Rajat was an outstanding student at Modern School.
His father died when he was sixteen and his mother died when he was eighteen. He ranked 15th in the IIT Entrance Examination of 1966 and was admitted to to IIT Delhi on a schlorship. He obtained his B.Tech in mechanical engineering in 1971. Very soon after he came to USA and enrolled in the prestigious Harvard University Business School on a scholarship. He obtained his MBA in 1973. He had said in an interview that Harvard was easy for him because of the excellent education that he had received at IIT. His colleagues at Harvard described him as an excellent student who could see the big picture very quickly. He joined McKinsey in 1973 and never looked back. He helped the "Firm" establish the Copenhagen office. He was elected principal in 1980 and director in 1984. In 1994, he was elected CEO of McKinsey. He was the first Indian to successfully break through the "glass ceiling".
He is on the Advisory boards of Harvard Business School and the Kellog Business School. He is married to his sweetheart from IIT days, Anita. His wife is an electrical engineer, who is described by Rajat, as "a much smarter student" than himself. She is two years junior toRajat and met at college debates and plays. They have four children.
Lessons learnt - Remember the proverb -If wealth is lost nothing is lost ; of health is lost something is lost; if character is lost everything is lost
