Gupta quits boards
Indian-American Rajat Gupta, the former McKinsey head and Chairman Managing Director of Indian School of Business, accused of passing insider tips to Galleon Group's billionaire hedge fund manager Raj Rajaratnam, has resigned from three corporate boards, including American Airlines.business Updated: Mar 08, 2011 23:08 IST
Indian-American Rajat Gupta, the former McKinsey head accused of passing insider tips to Galleon Group's billionaire hedge fund manager Raj Rajaratnam, has resigned from three corporate boards, including American Airlines.
In a filing to US market regulator Securities and Exchange Commission, AMR Corp, the parent company of American Airlines, yesterday said that 62-year old Gupta "voluntarily resigned from the boards of directors of AMR Corporation and its subsidiary, American Airlines, effective immediately."
The ex-director of Goldman Sachs also resigned from the board of outsourcing company Genpact Ltd, according to a separate regulatory filing.
Gupta notified Genpact of his resignation as non-executive chairman of the board of directors and as a member of the board of directors, the filing said.
The company received his formal resignation letter today. Prior to his resignation, Gupta had also served as a member of the board's nominating and governance committee. The IIT, Harvard Business School and MIT alumnus also resigned as director from the board of Connecticut-based electronic systems manufacturer Harman International Industries. Last week, Gupta had resigned as a director of Procter & Gamble.
The SEC had last week accused Gupta of insider trading, alleging that he passed information to Rajaratnam on companies including Goldman Sachs and Procter & Gamble. The Indian-American is also accused of sharing information with Rajaratnam about a $ 5 billion investment by Warren Buffett-led Berkshire Hathaway in Goldman in 2008.
Rajaratnam goes on trial in New York on Tuesday on charges of insider trading. Gupta has denied wrongdoing and called the SEC allegations baseless, saying the case against him is based on speculation and hearsay.
In a statement last week, Gupta's lawyer, Gary Naftalis, had said, "There is no allegation that Gupta traded in any of these securities or shared in any profits as part of any quid pro quo. In fact, Gupta had lost his entire $10 million investment in the GB Voyager Fund managed by Rajaratnam at the time of these events, negating any motive to deviate from a lifetime of honesty and and integrity."