Part 1 : My Hero was Rajat Gupta and his behaviour made me mad

Circa 2010 : I heard Rajat Gupta speak as a keynote at the Harvard Business School (HBS) in March 2010. HBS had invited a clutch of Indian Entrepreneurs to discuss Entrepreneurship in India.

And so, why was Rajat Gupta there? Well, he was the most illustrious Indian in the United States!

If you were present at the event, correct me if I am wrong, but I heard Rajat Gupta with a cracked voice. I heard more philosophy than gyaan. I heard the voice of regret ring out loud. On that particular day, I just assumed that he must’ve had a bad day. But today after learning about his horrendous actions, I am much wiser.

These are the 5 bitter lessons I have learnt from the punishing saga of Rajat Gupta, ending in his indictment for insider trading in the courts of New York.

1. If you hang out with criminals, you become one.

Someone I know was once arrested for economic fraud in India. He spent a couple of days locked up. When I met him, he said, “Alok, in two days in a white collar jail cell, I met the most seasoned criminals. They revealed various business ideas of how to cheat and deceive people. They offered to partner me to execute their plan.

My challenge was not dealing with the mental torture of being locked up, but of preventing those criminal ideas from manifesting themselves in my mind.”

Rajat Gupta ‘hung out’ with Rajaratnam. Now, a man like Rajat Gupta who has probably shaken as many hands as Obama has, knows how to ‘read’ people and quickly ascertain what they do. Yet he chose to associate with Rajaratnam. And sure enough, Rajaratnam brought him down.

Lesson – Do not associate with even borderline crooks. You will be transformed - from entrepreneur to fraud-preneur.

2. Some things are taught by the conscience, not by Mummy-Papa.

I recently signed up on a couple of websites to offer ‘over the phone’ consultancy to venture funds, investors, etc. who like to talk to professionals and entrepreneurs to understand specific domain issues and insights.

While registering myself, the online form made me take ‘tests’ to make sure I understood what ethics and code of conduct meant.

A question asked, “If a company you are doing diligence on offers to fly you first class to Las Vegas and back to help you ‘relax’ from your efforts, will you accept?” Now, when confronted by a question like this, I don’t need to scratch my head and wonder, “What did Papa teach me?” Isn’t it obvious that the answer is a DEAD ‘NO’?

So, did Rajat Gupta need special guidance to understand that after a board meeting of a company in which you hear private, confidential information, you DON’T call up strangers and tell them what you heard? Hey! You don’t even call up your wife and tell her!

Was Rajat Gupta’s conscience eating a pretzel on the streets of New York when he called Rajaratnam minutes after a secret Goldman Sachs board meeting and spilled all the information to him?

Lesson – be guided by your conscience always. It will never lie to you. Do not believe anyone else.

3. Denial is a demonstration of Vanity.

The Rajat Gupta case and the Bill Clinton-Monica Lewinsky case bear a strong resemblance.

Both defendants were powerful, men of the world, having ‘been there, done that, seen it all’. When they were cornered into a situation that was clearly brought unto themselves, they went into what I call a ‘synthetic denial’.

Both men used technical, obtuse, clinical language and terms to describe what they had done as being “incorrect, but not illegal”. Both insisted on making a public spectacle of themselves despite being so obviously in the wrong. Men like these have Himalayan sized egos. Their false vanity deceives even themselves!

From what I read, Rajat Gutpa was offered a fine, a rap and no jail term by the SEC if he would have admitted to insider trading. But he chose not to accept and went on to defend his wrong!

Lesson – Don’t be in denial. Do not let your ego deceive you. We all make mistakes. Once discovered, correct it and redeem yourself as fast as you can!

4. When you are wrong, you are alone.

As the Rajat Gupta prosecution shows, none of his best friends, associates or colleagues tried to save him or create a safety net for him.

Lloyd Blankfein – the CEO of Goldman Sachs publicly castigated Rajat Gupta about his conduct while serving as a board member of Goldman Sachs. From what I understood, no one supported Rajat Gupta other than his family members. He was all alone.

Lesson - the old adage that ‘friends and well wishers will come to my rescue when I am trouble’ is bunk. No one will come. Save yourself, by yourself.

5. Greed is Good. But it’s not God.

I am a huge fan of Gordon Gekko (from ‘Wall Street 1’). Not for his morals but for his ambition. Personally, I believe that the motivation to achieve a lot is a great way to create important value for yourself and for society. But I do not believe that Greed is God!

Rajat Gupta had everything. He had achieved so much that he could’ve had statues of himself in Mumbai and New York. But he wanted more. His Greed was not good; it became his God.

For some strange reason, the more successful people become, the more insecure they become about proving their capabilities, their self worth, and their value! This is a disease of the rich.

Lesson – Be greedy but be good. That’s what matters.


This was reproduced as an article in the ET

Part 2 : My observation became a part of a Book

Circa Jan 2013:

This article caught the attention of Anita Raghavan who was writing a book on this episode. 

This is what appeared inside the book:


Part 3 - I met Rajat Gupta!

AUG. 19, 2013 

So, I met Rajat Gupta. He was at the Sages and Scientists for all 3 days, but I gathered the gall to meet him this afternoon. I told him, "Rajat, I've admired you. After the insider trading incident, I got angry and wrote a negative blog in the Eco-Times on your conduct. But that has passed. Now, on behalf of Indian entrepreneurs (many of whom still ADORE you), can you tell me a few points of advise on 'How to be Successful'?

Rajat contemplated my question and replied:

1) BE PASSIONATE about what you do. Let your feet vote for your passion. If you love to return to work, then you are doing the right work.

2) "Keep looking around the Corner" - Even though you may be in a good job/business; keep looking out for what's happening.

3) HAVE A STRICT RULE GUIDE. Be very clear about your dos and don'ts.

4) Read the Gita. And believe in Best Effort; the fruit being what it may be.


Update - 18th-April 2014

The sad end (from the ET)



Rajat Gupta released after completing 2-year prison term


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Well written - found - when you are wrong, you are alone - particularly appealing....


Awesome article. Teaches a lot about ethics which people seem to be forgetting these days. I'm a huge fan of Gordon Gekko too and i think Greed is good, it keeps you motivated and focused but again it shouldn't be your God. 

thanks pallav

Excellent article.Beautifully written.Simple conveyed.Virtually written what i had in my mind.Somebody said Rajat Gupta made one error...and i said it was a series of errors all along the way.

thank u!

this time i was so curious to know the name of article's writer after reading your article in et.

you are so clear in your view ,especially fundamentally your lines are so strong , i really loved your article.

The best and important lessons i like are "if you hung-out with criminals, you become one" & one line "men like these have himalayan-sized egos , there  false vanity deceives even themselves". thanks  

thank you sir. these are the values i have learnt from my parents, and my gurus.

@ Alok - Time has come when we start redefining " SUCCESS " & " ACHIEVMENTS "

" Almost ", if not "ALL" companies, their Promoters ( Entrepreneurs) / Directors / Executives OR anyone - whether we talk of Politicians / Sportsman / Film actors / Lawyers ( you just name it ) are involved in some or the other unlawful, unethical means to be successful / achieve.

It's high time we distinguish between " ACHIEVERS " and " Accumulators of WEALTH & BAD KARMA"

There are many such Rajat's - like around us and they exist because we at large applaud, praise and perceive them as ( Successful Achievers ) and follow them - to be one like Rajat and at any cost.

I am glad  - I am not that " SUCCESSFUL" and would not, want to be in any circumstances and at that Cost.


Great article.This should be taught to every person when he starts his career and should hang this in his office or in fron of his desk.These are the most most important code of conducts.

thanks BIG BOSS


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