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Gupta gets jail reprieve

New York, Dec. 5 (PTI): Rajat Gupta, the Calcutta-born former Goldman Sachs director, can stay out of prison as he fights his conviction on insider-trading charges with an appeals court accepting his request on a $10-million (Rs 54 crore) bond.

The 64-year-old was to begin his two-year term on January 8. The court is expected to start hearing his appeal around April next year and it could be a year before his plea to overturn his conviction is ruled on.

Gupta’s wife, accompanying him along with their four daughters at the hearing yesterday, burst into tears after the decision was announced.

“It is hereby ordered that the conditions of release imposed by the district court will be continued. Motion is granted,” US Second Circuit Court of Appeals Judge Jose Cabranes said in the ruling, allowing Gupta to remain free on bond.

Judge Cabranes issued his order after consulting district court judge Reena Raggi, who was also on the jury panel. The district court had handed the sentence in October.

Other bail conditions include surrender of passports and travel restrictions.

Gupta and his lawyers declined comment on the ruling, as did the office of Manhattan’s top federal prosecutor, India-born Preet Bharara, who had brought the charges.

The ruling comes as a relief for Gupta, who was one of the most-high-profile Wall Street executives to be charged with passing confidential boardroom information about Goldman Sachs to friend and business associate Raj Rajaratnam.

Prosecutors alleged that Rajaratnam, the founder of hedge fund Galleon, made millions of dollars in profit and avoided huge losses, allegedly on Gupta’s tips.

Gupta, who also once headed consulting major McKinsey, was convicted in June this year on one count of conspiracy and three counts of securities fraud. Four months later, the district court handed the two-year sentence along with a fine of $5 million (Rs 27 crore).