Leaked information to Rajaratnam after he taunted me: Kumar
New York: An Indian-American former McKinsey consultant has told a US court that he "committed a crime" by passing on secret information to convicted hedge fund founder Raj Rajaratnam after the Sri Lankan "chided and taunted" him for not knowing enough about what was happening at various firms.
Anil Kumar, 53, is a government witness in the insider trading trial of his mentor and fellow Indian native and ex-Goldman Sachs director Rajat Gupta.
Kumar, an IIT Mumbai and Wharton Business School alumnus, has pleaded guilty to criminal charges of passing inside information to Rajaratnam and had testfied at the Galleon founder's trial last year.
A Chennai native, Kumar is hoping to get a lenient sentence for his charges in return for cooperating with the government in its crackdown on insider trading on Wall Street.
During testimony earlier this week against 63-year-old Gupta, Kumar told jurors in a Manhattan courtroom that he gave inside information to his Wharton batchmate Rajaratnam after the Sri Lankan taunted him for not knowing enough about companies, including regarding chipmaker Advanced Micro Devices (AMD), despite working as a partner at McKinsey.
Rajaratnam "taunted and chided me and said that he knew more about AMD than I did. I tried to show him I had more information about AMD and other companies and committed a crime," Kumar said in his testimony.
In a 2008 telephone conversation between Gupta and Rajaratnam, the hedge fund founder says that he is giving Kumar "a million dollars a year for doing literally nothing."
During Rajaratnam's trial last year, Kumar had admitted accepting USD 1.75 million from him and said he tipped the onetime billionaire on deals involving McKinsey clients including AMD.
In his testimony earlier this week, Kumar termed Gupta as a "calm" man who did not easily get "ruffled."
However, Kumar said the former McKinsey managing director was "very annoyed, frustrated and emphatic" after Rajaratnam lost USD 10 million of Gupta's investment in the Voyager fund during the financial crisis.