Published July 17, 2012
Rajat Gupta, the former Goldman Sachs board member recently convicted for providing illegal trading tips to former Galleon chief Raj Rajaratnam, has made an unusual request to former business associates and prominent acquaintances urging them to write letters of support to the judge in the case so he can receive the most lenient sentence for his crimes, the FOX Business Network has learned.
A copy of the request, obtained by FBN, even goes so far as to suggest that U.S. District Judge Jed Rakoff “would like to receive letters of support from friends and family” so the judge can “understand me as a person. This gives the judge a full idea of who I am and significantly influences the decision.”
“I look forward to hearing from you with a positive response,” Gupta added in the request sent earlier in the month, “and thank you very much in advance.”
Gupta is scheduled to be sentenced on Oct. 18, and faces as many as 20 years in jail for securities fraud. So-called support letters of this kind have been known to prod judges to hand out more lenient sentences, though Gupta may have overplayed his hand in suggesting that Rakoff is personally requesting the letters.
The Fox Business Network has learned that Gupta sent the request to numerous people without his attorney reviewing the content. A press official for Rakoff said there has been “no active solicitation of letters” from the judge. FBN has also learned that after being alerted to the language in the request, Gupta’s attorney Gary Neftalis, reissued the correspondence removing the line implying the judge’s advocacy for the letters and simply pointing out that such letters of support delivered to the sentencing judge are “customary”
Both Neftalis and Gupta declined to comment.
Columbia University law professor John Coffee said Rakoff is known to take letters of support seriously in doling out sentences, though he said Gupta’s aggressive pitch to friends and colleagues “is not going to help” in gaining leniency.
The aggressive tone of the letter underscores the difficult spot that Gupta finds himself in following the guilty verdict. The former Goldman board member, and head of the giant McKinsey & Co., was cleared of two counts during his trial last month.
Yet he was convicted of several more, and is widely regarded as the most prominent business executive snared in the government crackdown on insider trading. Among the most sensation counts Gupta was convicted on involved leaking to Rajaratnam details of a Goldman Sachs board meeting involving Warren Buffett’s infusion of cash into the firm at the height of the financial crisis.
Prosecutors showed phone records in which Gupta called Rajaratnam shortly after the board meeting and Rajaratnam purchased shares of Goldman before Buffett’s move was made public. Rajaratnam himself was convicted of multiple counts of securities fraud and insider trading violations and is serving an 11-year sentence.
Most legal experts don’t expect Gupta to receive as lengthy of a jail term as Rajaratnam; prosecutors are likely to ask for a decade of jail time based on sentencing guidelines, but Gupta himself never traded on the inside information. The best prosecutors could do was portray Gupta as using his inside knowledge and tips to curry favor and do business with Rajaratnam, once a billionaire fund manager and one of Wall Street top traders.
In Gupta’s favor is Rakoff’s reputation for handing less jail time than what prosecutors often recommend, which is why Gupta’s request for letters from prominent people--many of them in fields outside of Wall Street--is so important.
Friends of Gupta say both he and his family were hit hard by the guilty verdict, and the likelihood of jail time and the letter suggests as much. “By now you must have heard the guilty verdict in my case,” he wrote. “Even though the jury acquitted me of a number of charges, it was a very negative outcome for me. Needless to say it has been a terrible six weeks for me and my family. I can’t believe this is happening to me but I have to accept reality. I will never give up and I will of course appeal the jury’s verdict.”
In his pitch, he described the letter as a “private and confidential letter written in a personal capacity, and its sole purpose is for the judge to understand me as a person. This gives the judge a full idea of who I am and it significantly influences his decision.”
He added “I look forward to hearing from you with a positive response, and thank you very much in advance. I would love to connect in the future, regards, Rajat.”
One additional reason for the aggressive pitch may be that Gupta believes Rakoff will be less likely to cut such a prominent person a break on sentencing. A former prosecutor who has argued cases before Rakoff says the judge is known to come down hard on white collar defendants who “should have known better.” Rakoff sentenced attorney Marc Drier to 20 years in prison for stealing $400 million from his clients.
“Let’s face it, Gupta is a board member of Goldman and the former head of McKinsey,” the former prosecutor said. “He knows that he’s isn’t supposed to be telling people about what goes on during board meetings, and that may force Rakoff to come down harder on him than he would otherwise.”