"Gupta surrendered to the Manhattan office of the FBI in New York at 8:10 am today (Wednesday). He is in FBI custody," a FBI official told PTI on condition of anonymity. On the kind of charges that would be slapped against 62-year-old Gupta, the official said, "The charges against him are expected to be filed later in the day." Asked specifically if Gupta has been arrested, the official said, "He has surrendered to the FBI. Once in FBI custody, he is under arrest." Gupta, a former director of Goldman Sachs and Procter & Gamble.
He appeared in a US court after being arrested and indicted in a six count indictment on securities fraud. Gupta, 62, who surrendered before the FBI earlier in the day, made his appearance in US Magistrate Court in New York before Judge Kevin Fox. Following his presentment, he will be arraigned before US District Judge Jed Rakoff in the US District Court, Southern District of New York. He is charged with one count of conspiracy to commit securities fraud and five counts of securities fraud. He faces a maximum penalty of five years in prison on the conspiracy charge and 20 years in prison on each of the securities fraud charges.
In addition, with respect to the conspiracy charge, Gupta faces a maximum fine of USD 250,000 or twice the gross gain or loss accrued from the crime. For each of the securities fraud charges, Gupta faces a maximum fine of USD 5 million or twice the gross gain or loss derived from the crime.
Gupta is accused of committing securities fraud as he shared confidential information with hedge fund manager Raj Rajaratnam, the Sri Lanka born founder of Galleon Group. Gary Naftalis, Gupta's lawyer, has said that his client is innocent. Gupta "did not trade in any securities, did not tip Rajaratnam so he could trade, and did not share in any profits as part of any quid pro quo," Naftalis said in a statement.