Former Goldman Sachs Group director Rajat Gupta on Tuesday lost his challenge to a $13.9 million civil penalty and a permanent ban from acting as an officer for a public company, the same day he was scheduled to begin serving a two-year prison sentence.
An appeals court in New York ruled against Gupta's claim that the penalty and ban were excessive.
A federal jury convicted the 65-year-old in June 2012 of passing confidential information he learned from Goldman board meetings to Raj Rajaratnam, the Sri Lanka-born former billionaire and founder of the Galleon Group hedge fund.
Rajaratnam is serving an 11-year prison sentence.
His younger brother, Rengan, a former Galleon portfolio manager, went on trial on Tuesday in New York on charges that he engaged in an insider trading scheme with his brother.
Gupta was sentenced to a two-year prison sentence as well as $6 million in restitution to Goldman and a $5 million fine as a result of his criminal conviction.
The US Securities and Exchange Commission also filed a parallel civil action against Gupta, leading to a $13.9 million penalty and a lifetime ban from acting as a public company's officer. Gupta had appealed the civil sanctions as unwarranted.
Gupta was scheduled to report to federal prison on Tuesday.BLOG COMMENTS POWERED BY DISQUS