As a lawyer, Jed Rakoff once persuaded a judge to give probation to a client convicted at an insider-trading trial alongside former Wall Street Journal reporter R. Foster Winans.
Now a federal judge himself, Rakoff must weigh Rajat Gupta’s similar request to stay out of prison.
Gupta, a former Goldman Sachs director, will come before Rakoff in Manhattan federal court tomorrow to be sentenced for leaking stock tips to Galleon Group co-founder Raj Rajaratnam.
Prosecutors say Gupta, convicted by a jury in June, deserves as long as 10 years in prison. Gupta seeks probation.
Gary Naftalis, a lawyer for Gupta, argued his client’s crime was an “aberrational” event in a “lifetime of good works” that merited a punishment for a man who has suffered an extraordinary fall from grace. He asked Rakoff to impose a term of community service, suggesting Gupta work with troubled youth in New York or with the poor in Rwanda.
“Good works help, but on their own they are rarely a ‘Get out of jail free card,’” said Gordon Mehler, a former federal prosecutor who’s now in private practice in New York. “So, it seems as if probation, even in Rwanda, is unlikely.”
After a four-week trial in June, jurors found Gupta, 63, guilty of tipping Rajaratnam about dealings at Goldman Sachs. Rajaratnam, 55, is serving 11 years in prison for trading on tips from Gupta and others.