Gupta will have to cough up $6.2 million fees in Goldman probe - GS, PG & BRK.A

Northern, WI 02/26/2013 (avauncer) - A former director of Goldman Sachs Group, Inc (NYSE:GS), Rajat Gupta has been ordered to pay up over $6.2 million as compensation for the legal fees and investigation expenses that the bank incurred in its case against the accused. The 64-year old Gupta was on the board of The Procter & Gamble Company (NYSE:PG) based in Cincinnati as well as Goldman Sachs Group, Inc (NYSE:GS) based in New York and was convicted in the insider trading case. Gupta has been convicted of leaking insider trading information to his friend and former business associate Raj Rajaratnam. The latter is the co-founder of hedge fund Galleon Group LLC

Proved guilty in trading leak

Goldman Sachs Group, Inc (NYSE:GS) argued that Gupta’s crimes had subjected it to a Federal probe by the FBI and the Manhattan U.S. Attorney’s Office which led to them spending $6.9 million in fees and other investigation-related expenditure. On Monday, U.S. District Judge Jed Rakoff said in a ruling that it has been proved beyond doubt that 90 percent of the expenses incurred by the Goldman were necessary in the investigation and prosecution of Gupta. Rajaratnam is currently serving his 11-year sentence after his conviction in the case in 2011.

Gupta had leaked insider information to his friend about the $5 billion that Berkshire Hathaway Inc (NYSE:BRK.A) had invested in Sep 2008 as well as a quarterly loss that the firm had suffered in Oct 2008. Rakoff had ordered Gupta to surrender to American police officials and had sentenced him to 2 years in imprisonment but a Federal ruling had permitted him freed him to fight his conviction.

Shares of Goldman Sachs Group, Inc (NYSE:GS) went down by 4.18% to close at $147.65

Shares of The Procter & Gamble Company (NYSE:PG) went down by 1.39% to close at $75.92

Shares of Berkshire Hathaway Inc (NYSE:BRK.A) went down by 1.39% to close at $149,900.00