Abstract

This case recounts the story of Rajat Gupta, a Goldman Sachs board member and seniorpartner emeritus of McKinsey & Co., who was accused by the government of giving critical nonpublicfinancial information to Raj Rajaratnam, Galleon Group founder, during the financial crisisof 2008. The information passed along to Rajaratnam was about a pending $5 billion investment byWarren Buffett’s Berkshire Hathaway in Goldman Sachs at a time when its stock had been faltering.The government alleged that based on this information, Rajaratnam purchased a large number ofshares in the company and then sold them when the deal became public and Goldman’s stock rose.Rajaratnam purportedly made $18 million on these trades.