New Silk Route’s Gupta takes leave of absence

The firm’s chairman, currently fighting allegations of insider trading, has taken an indefinite leave of absence from the private equity firm he co-founded five years ago.

Rajat Gupta, chairman and co-founder of private equity firm New Silk Route, has taken a leave of absence from the firm after he was charged by the US Securities and Exchange Commission (SEC) for insider trading.

It is unclear how long Gupta’s leave will be. New Silk Route did not respond to requests for comment by press time.

“We will respect Mr. Gupta’s request. We believe that he will be exonerated,” Parag Saxena, CEO and co-founder of the firm, was quoted as saying in the New York Post

Gupta was charged by the SEC earlier this month after allegedly having provided confidential information gleaned from his tenure on the Goldman Sachs and Procter & Gamble boards to Raj Rajaratnam, founder of hedge fund Galleon Management.

His tip-offs allegedly included information about the quarterly earnings of both companies and an impending $5 billion investment by Warren Buffett into Goldman Sachs during the financial crisis of 2008.

The information Gupta gave to Rajaratnam helped him generate more than $18 million in illegal profits and loss avoidance, according to a SEC statement. Gupta was believed to have “lucrative” business interests with Rajaratnam and was an investor in at least some of the Galleon hedge funds.

With offices in New York, Mumbai, Bangalore and Dubai, New Silk Route focuses on investment in South Asia, the Middle East and other emerging Asian economies. The firm currently manages assets of $1.4 billion.