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Posted on Feb 26, 12:53PM | IANS
New York, Feb 26 : Rajat Gupta, the former Indian-American director of Goldman Sachs convicted of insider trading, has been ordered to pay the bank more than $6.2 million for legal expenses connected to his case.
US District Judge Jed Rakoff, who presided over Gupta's criminal trial for allegedly passing tips to convicted hedge fund manager Raj Rajaratnam, gave the ruling Monday in response to a claim filed by Goldman. Gupta, 64, who is free on bail while he is appealing his May conviction by a jury, was sentenced by Rakoff to two years in prison.
Goldman had sought $6.9 million in reimbursement from Gupta under a law that allows corporations to get reimbursed as a victim of an insider trading crime by a rogue employee.
"Goldman Sachs has proved by a preponderance of the evidence that 90 percent of its tendered expenses were both necessary and incurred during its participating in the investigation and prosecution," Rakoff ruled.
After reviewing the firm's 542 pages of billing records, he wrote that Gupta raised no "colourable challenge to the veracity of the records."
Rakoff cut the bill by 10 percent, he said, because he noted that there were some extraneous entries.
Rajaratnam, convicted of insider trading in 2011, is serving an 11-year prison sentence.
Michael Duvally, a Goldman spokesman, said the bank was pleased the court ordered Gupta to pay it restitution.
The money that Gupta now has to pay Goldman is separate from the cost of Gupta's legal defence, which has thus far exceeded more than $30 million, according to New York Times.