The Indian insider
The conviction in the United States of Rajat Gupta, former managing partner of McKinsey & Co. and co-founder of ISB, Hyderabad, for insider trading has come as a shock to corporate India, specially to those who knew him and his work.
He could face a jail sentence of 20 years for the securities fraud. Gupta’s conviction is all the more shocking because such a conviction is most unlikely in India. Even if big-shot corporate figures are caught, they are rarely, if ever, convicted, or given exemplary punishment.
The outstanding example is that of the founder of the erstwhile Satyam Computers, Ramalinga Raju, who committed a most grievous fraud of nearly `8,000 crore on his shareholders and even admitted to the fudging of the company’s accounts. But apart from receiving royal treatment under some sort of gentle house arrest, he is now roaming scot-free.
White-collar criminals in our country go free as there is one set of laws for the rich and powerful and another for the poor. In the US, top corporate promoters and chiefs have been given 100- to 150-year prison sentences. Gupta’s conviction is seen as another instance of no one being above the law in the US.
Our regulatory bodies, like the Securities and Exchange Board of India, or even an investigative body like the CBI, are reportedly understaffed. In the case of Sebi, the surveillance system is not as efficient as it should be. We are still to see an insider trading criminal punished in India though the crime is rampant.
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