Ex-Goldman Board Member Rajat Gupta Is Suing The SEC

Rajat Gupta is suing the SEC because it connected him to the Galleon insider trading case when it filed civil charges against him a few weeks ago.

A former McKinsey chief and Goldman Sachs executive, Gupta “denies all allegations of wrongdoing and ‘stands ready to mount a defence against each and every one of the commission’s charges,'” according to the AP, via the Wall Street Journal.

The regulator charged Gupta earlier this month in connection to the government’s fraud case against Raj Rajaratnam.

The SEC alleges that when he was a Goldman Sachs board member, Gupta tipped Rajaratnam on Goldman earnings and the $5 billion Berkshire Hathaway investment, as well as other material, non-public information about the bank, which Rajaratnam then allegedly traded on.

The timing of charges against Gupta was the cause of a bitter feud between the SEC and the federal prosecutors who brought action against Rajaratnam; agency head Mary Schapiro was forced to step in.

Earlier today, Bloomberg reported that wiretapped calls between Gupta and Raj, in which Gupta tells the Galleon founder confidential information about Goldman considering purchase of AIG and Wachovia back in 2008, were not enough to justify charges. John Carney at NetNet had also reported why the wiretapped conversations might prove to be Gupta’s saving grace.

That’s all we know for now.

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