Rajat Gupta's daughter testifies on Day 14 of trial

Rajat Gupta's daughter testifies on Day 14 of trial

On Day 14, Geetanjali Gupta, testified on behalf of her father Rajat Gupta, former global head of consultancy firm McKinsey & Co., who is facing charges of insider trading.

Rajat Gupta Rajat Gupta
On Day 14, Geetanjali Gupta, testified on behalf of her father Rajat Gupta, former global head of consultancy firm McKinsey & Co., who is facing charges of insider trading. Geetanjali's testimony was part of efforts by Gupta's legal team to counter the charges and show him as a corporate citizen who is committed to causes like fighting malaria.

Gupta's eldest daughter's testimony, however, didn't get far on Monday. The prosecution objected to the Gupta's counsel's questioning her on a September 2008 conversation, which the witness said she had with the defendant about Raj Rajaratnam, co-founder of the Galleon Hedge Fund LLP.

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Geetanjali, 33, had said she had come to the family home in Westport, Connecticut on September 19, 2008 for a "family celebration" over the weekend.  

Gupta has been accused of passing insider tips to Rajaratnam about Goldman Sachs Group Inc. and Procter & Gamble Co. while serving both boards as a director. Rajaratnam, convicted of insider trading last year, is serving an 11-year prison sentence.  

Gupta's legal team is trying to convince the 12-member jury that the former McKinsey partner and Rajaratnam were not on good terms in 2008, while the prosecution has tried to establish that the two men had an extensive relationship. Geetanjali is expected to testify on Tuesday about Gupta's $10 million loss in Voyager Capital Partners Ltd, a joint fund with the billionaire hedge fund manager.

Rajat Gupta trial

The defendant's wife Anita and three other daughters have been present in court every day.

Gupta's counsel also called as a witness Suprotik Basu, a 34-year-old public health specialist who works at the United Nations. Basu testified that he came to know Gupta as they were "working together to close a funding gap to end malaria".

The witness told the jury that he was in a meeting with Gupta on September 23, 2008 from 5:00 pm to 5:45 pm and then met from 8:00 pm to 10:00 pm when they also had dinner. "Did he say anything about Goldman Sachs," asked Gupta's lawyer Gary Naftalis. "Did he say anything about Warren Buffett?"  "He did not," replied Basu.

The date is significant because on September 23, Gupta allegedly called Rajaratnam minutes after a Goldman Sachs board meeting to tell him that Warren Buffett's Berkshire Hathaway Inc. was going to inject $5 billion in the investment bank. A few minutes before the market closed that day, Rajaratnam bought more than 200,000 Goldman Sachs shares.  

Naftalis, much to the prosecution's consternation, quizzed Basu on whether Gupta answered pending phones calls right after meetings. The witness said that he could picture Gupta with an "ear piece in his ear" returning calls between meetings.  

Gupta's counsel appeared to be suggesting that calls made immediately after boardroom meetings were made out of habit to return calls and they were not to pass on information.  

Assistant US Attorney Reed Brodsky rose from his chair, several times, and threw his hands up in the air while persistently objecting to this line of questioning about Gupta's phone call habits.   

Basu also testified as a character witness. "I consider Rajat to be one of the most honest, forthright, genuine and giving persons that I know," he said, also telling the jury that the defendant had introduced him to his fiance.  

During Basu's cross-examination, Brodsky shot out a string of questions. One was on if "you don't have any personal knowledge" on Gupta's investment and relationship with Rajaratnam. "No," the witness replied.  

Basu told Brodsky that he was not present in the McKinsey New York office at 3:54 pm on September 28 when Gupta allegedly called Rajaratnam to tell him about Buffett's investment.  

Earlier in the day, Gupta's old friends, Anil Sood, who worked with the World Bank, and Ashok Alexander, who runs the Bill and Melinda Gates Foundation in Delhi, were also called upon to testify as character witnesses.  

Gupta's lawyers also used another witness they called, Richard Schutte, President of Galleon's domestic operations, to build an argument that their client was not heading Galleon Global as suggested by the prosecution. "I am not aware that he (Gupta) was chairman," said Schutte, suggesting it was another man called Frank Wong (who joined Galleon in 2009 as the Chairman of Galleon Asia).  

During cross-examination, however, the prosecution pulled out several emails that suggested Gupta was part of Galleon's efforts to find investors in the Middle East. Gupta, for instance, was copied on an April 2008 email sent by Galleon marketing executive Ayad Alhadi discussing a visit to New York by the Abu Dhabi Investment Council.  

The prosecution has previously called as a witness Alhadi who testified that Rajaratnam told him that Gupta would be the chairman of Galleon International, and that the defendant had accompanied him to the United Arab Emirates in 2008 to generate investments for the hedge fund.

Gupta's counsel is expected to wrap up its case by Tuesday and it is likely that closing arguments will be made on Wednesday.

Published on: Jun 12, 2012, 12:23 PM IST
Posted by: Navneeta N, Jun 12, 2012, 12:23 PM IST