Wall St pariah fights to win back friends
ONE June evening last year, some of New York’s most prominent IndianAmericans gathered at a gated house in Rye, New York.
A few dozen Indian-American businessmen and their wives had arrived at the home of Ajit Jain, a top executive at Berkshire Hathaway, say people who were invited to the dinner. They were there to welcome back Rajat Gupta.
Only two months before, Gupta had finished a two-year prison sentence for divulging corporate secrets to Raj Rajaratnam, the hedge fund titan serving the longest sentence for insider trading.
To those invited, Gupta’s presence at a dinner given by an executive of Jain’s stature was a sign that he was to be embraced by Indian business leaders in the United States.
It was a striking show of support. Gupta had been convicted four years earlier of tipping off Rajaratnam to a crucial 2008 investmentstment in Goldman Sachs chs made by Berkshire Hathaway. Gupta was a director on thee board of Goldman Sachs when Buffett poured $5 billion into the firm at the height of the financial crisis.
G u p t a , t h e f o r me r g l o b a l head of consulting ng giant McKinsey y & Company, became came a pariah among many of the corporate chieftains who once craved his counsel. Now 68, he has been trying to restore his reputation and rebuild his fortune since being released from a federal prison medical centre in Devens, Massachusetts.
But he has struggled to reconnect with many formerfo associates and clientsc in the US. HisH ties to India’s businessbus community, andan its diaspora of executivesex in the UnitedU States, have provedp more durable.b Many of them, likeli Ajit Jain, go backb many years. BothB Ja i n and GuptaG were gradua t e s of Indi a’s famedf a breeding groundg for chief executives, the Indian Institute o of Technology. Gupta’s relationships with non-Indian business leaders were usually newer and often driven by commercial considerations. When the commercial promise was shattered, the relationship broke down.
“The system in America had a stake in Rajat Gupta,” said Suhel Seth, the founder of the Delhi-based brand marketing firm Counselage. “There was a greater investment of respect and trust in the man, so they were the ones who felt a sense of deep betrayal.” By contrast, he noted, “the people who welcomed him with open arms in India had benefited more from him than he from them”.
During Gupta’s heyday, he was a sought-after board member and a regular attendee at gilded events like the World Economic Forum’s annual meeting in Davos, Switzerland.
Now, Gupta cannot get his former firm, McKinsey, which he led for nine years, to even acknowledge him.
McKinsey declined to comment, and Gupta declined to comment for this article.
The rebuffs by McKinsey have rankled him, friends say. He is upset that the firm at which he spent almost his entire career won’t even acknowledge him as an alumnus.