I lost my reputation, says apologetic Rajat Gupta
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 US 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, Gupta 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 USD five million fine and would have to surrender in prison on January 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 apologised 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. The IIT and Harvard educated Kolkata native said he also often thought about three not-for-profit organisations — 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.