Oct. 27: Raj Rajaratnam, the hedge fund billionaire at the centre of historys biggest insider trading case that has also snared Rajat Gupta, has said that every bloody Indian co-operated with US authorities to entrap him.
Every bloody Indian co-operated — Goel, Khan, Kumar, Rajaratnam told Suketu Mehta, the author, in an article published in Newsweek magazine.
Goel is Rajiv Goel, a Wharton classmate and a former Intel employee, Khan is Roomy Khan, a former employee of Rajaratnams hedge fund Galleon, and Kumar is Anil Kumar, another Wharton friend and former employee of McKinsey which was once headed by Gupta.
The trail led to Rajaratnam after Roomy was picked up by FBI in 2007. She allegedly made a deal with the FBI which wiretapped her conversations with Rajaratnam.
Mehta writes that the US governments case rests principally on Rajaratnams two Wharton classmates, Kumar, the McKinsey executive who was hired by Galleon as a consultant, and Goel. Both pleaded not guilty first, Rajaratnam told Mehta, before they switched to guilty under pressure.
I did not think a senior partner of McKinsey (Kumar) would violate the confidentiality of McKinsey. I assumed he was kosher, that he would not cross the line, Rajaratnam, a Tamilian from Sri Lanka, said during the interview. Sentenced to 11 years in jail, Rajaratnam is scheduled to serve time from November 28.
Mehta writes that part of Rajaratnams narrative is that of a man from a smaller South Asian country seduced and betrayed by people from the Big Brother country. Kumar had introduced him to Rajat Gupta. The two of them wanted to start an Indian School of Business in Hyderabad.
I gave them (the school) a million dollars. I later found out they never contributed any of their money, and are listed as the schools founders. And Im not even a f****** Indian, Rajaratnam said.
Mehta writes that the South Asian connection makes less sinister some of the allegations in the trial. For example, the prosecution noted that Rajaratnam would visit Goels house in Silicon Valley, presumably to talk about Intel. But the real explanation is more human. His wife makes really good chaat! Rajaratnam and Goel were very good friends, so his betrayal hurts him personally.
Rajaratnam told Mehta: There are two types of plea bargains. One is, you co-operate with the government. You finger 10 other people. The other is a plea bargain without co-operation…. The South Asians all did the plea bargain with fingering. The Americans stood their ground.
Rajaratnam puts it down to the insecurity of being an immigrant, lawyers bullying them into that position.
During the interview, Rajaratnam revealed that the FBI wanted him to wear a wire and tape his conversations with Gupta, who was the most respected Indian executive in the US.
Rajaratnam referred to Gupta as a first-class guy and said the US government continued to ask him to turn on Gupta as late as two weeks before the sentencing. But he apparently refused.
Anil Kumars son worked at Galleon one summer. I used to vacation with Rajiv Goels family. Their families knew my family. You dont think this is going to haunt these guys? They wanted me to plea-bargain. They want to get Rajat. I am not going to do what people did to me. Rajat has four daughters, Rajaratnam said in the interview.
Mehta writes that the Rajaratnam case can be seen as a metaphor of the difference between immigrants from South Asia, who have a more elastic view of rules and a more keenly developed art of networking, and their children, the first generation, schooled to play by American rules.
Mehta refers to Preet Bharara, the US attorney who led the insider-trading investigation and who came to the US when he was an infant.
But Rajaratnam also swears by American justice in spite of his complaints. In Sri Lanka I would have given the judge 50,000 rupees and hed be sitting having dinner at my house. Here, I got my shot. The American justice system is by and large fair, he told Mehta.