The disgraced former board member of Goldman Sachs who is accused of leaking inside information about Goldman’s stock, Rajat Gupta, took the fifth amendment rather than explain himself to the SEC.
It’s an interesting move coming from a man who dismissed the claims against him as “baseless” through his lawyer.
Gupta is also suing the SEC for singling him out.
So why wimp out now?
Gupta took the fifth when the SEC questioned Gupta after it charged him on March 1st for passing the insider information to Raj Rajaratnam.
The evidence against him is pretty strong. Some of the biggest insider tips Raj got were from Gupta, who told him ahead of time that Warren Buffett was going to make a $5 billion investment in Goldman Sachs and that Goldman’s earnings in the fourth quarter of 2008 were going to be lower than expected. Gupta also told him that Goldman was thinking about buying AIG or Wachovia.
Gupta’s denial, followed by his pleading the fifth, might be an attempt to leave his lawyers to make the defence case for him when he fights the SEC’s lawsuit against Gupta.
Gupta’s lawyer, Gary Naftalis, made this statement: “We repeatedly advised the SEC that Mr. Gupta was prepared to testify fully as soon as the Rajaratnam trial concluded. Regrettably, the SEC was unwilling to wait this brief period of time in order to have a full and fair factual record.”