From The Daily Beast by Allan D. Frank
Rajat Gupta was trusted by McKinsey, Goldman, and AMR. But the SEC says he shared insider secrets so a hedge fund could make millions improperly in the market.
The reputation of McKinsey, the world’s most important consulting firm, is built on the perception that its high-priced consultants are the brightest and most trustworthy group available anywhere. Now Rajat Gupta, who served as McKinsey’s global managing director for nearly a decade, is enmeshed in Wall Street’s biggest insider trading scandal ever.
According to the Securities & Exchange Commission administrative filing, Gupta—as a board member of Goldman Sachs—learned on Sunday, Sept. 21, 2008, that Berkshire Hathaway chairman Warren Buffett was going to pump $5 billion into Goldman during Wall Street’s dark hours barely a week after the collapse of Lehman Brothers.
“Mr. Gupta was honored with the highest trust of leading public companies, and he betrayed that trust by disclosing their most sensitive and valuable secrets,” said SEC director of enforcement Robert Khuzami in a statement.
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