Former Goldman Sachs' Indian American director Rajat Gupta was convicted Friday of four of six counts on charges of providing insider tips to convicted hedge-fund billionaire Raj Rajaratnam.
A jury at Manhattan federal court convicted Gupta of three counts of securities fraud and one count of conspiracy. He was acquitted on the remaining two counts of securities fraud.
The jury reached its verdict on the second day of deliberations concluding a four-week trial that began May 21.
Securities fraud carries a maximum prison sentence of 20 years. Conspiracy carries a five-year maximum prison sentence. Gupta will remain free on bail until his sentencing Oct 18, Bloomberg reported.
The verdict is a victory for the office of Manhattan US Attorney Preet Bharara and the Federal Bureau of Investigation in their drive against insider trading. They used tools normally employed against organized crime, including phone taps and informants.
Gupta, 63, is the most prominent of those convicted at trial or to plead guilty since the nationwide crackdown began in October 2009.
To date, the US has brought cases against 66 traders and their sources from Wall Street to Silicon Valley. No one has won an acquittal; six cases are pending, Bloomberg said.
Besides his tenure at Goldman Sachs and McKinsey, which he ran from 1994 to 2003, the Kolkata-born Gupta served on the boards of the Rockefeller Foundation and the Bill & Melinda Gates Foundation.
Rajaratnam, who co-founded Galleon Group LLC, was convicted at trial last year and sentenced to 11 years in prison, a record at the time for insider-trading crimes. He is appealing the verdict.