Puneet Dikshit, an Indian-American former partner at McKinsey & Company has been sentenced to two years in prison by US District Judge Colleen McMahon for securities fraud in connection with committing insider trading, according to a press release issued by the US Attorney for the Southern District of New York on 6 April.
Since he is not a US citizen, after completing his term prison, he will be deported to India. He has a 5-year-old daughter and a 2-year-old son.
"With today's sentence, Puneet Dikshit must face the consequences of his egregious crime. We will continue to vigorously protect the integrity of our capital markets and hold accountable those who cheat by trading on inside information. This conviction shows Wall Street and Main Street that corporate advisors who steal information entrusted to them and use it for their personal gain will be caught and prosecuted."Damian Williams, US Attorney for Southern District of New York
In simple words, insider trading means trading stocks to one's own advantage by being privy to confidential information. Since others don't have access to the same information, the practice is considered infair and is illegal.
The court documents state that Goldman Sachs Group, Inc was trying to acquire and integrate into it a publicly-traded financial technology company called GreenSky.
Dikshit was one of the McKinsey partners leading these engagements with Goldman Sachs, thereby having access to confidential information, which he misappropriated for insider trading.
The information was used by him to purchase out-of-the-money GreenSky call options which were about to expire just days after the acquisition announcement.
Following the acquisition, GreenSky share prices jumped by 44 percent, according to CNBC.
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