Just a few years ago, Raj Rajaratnam and Rajat Gupta were two of the most admired business

luminaries from the twice blessed generation of South Asian immigrants. Both were born after India achieved independence from Britain in 1947, and both came to the United States after the Hart-Celler Act of 1965 abolished national origin quotas. Like many top students at the time, they sought graduate business degrees: Rajaratnam at the Wharton School, Gupta at Harvard.

Rajaratnam founded the Galleon Group hedge fund and became a billionaire, and was considered the richest Sri Lankan-born person in the world. Gupta rose within McKinsey & Company to become the elite consulting firms three-term leader and the first Indian-born chief executive of a multinational company. Both were rich and reputable, traveling in the most exclusive social and business circles. Rajaratnam was dedicated to helping victims of land mines; Gupta presided over global efforts to fight AIDS, tuberculosis and malaria. Needless to say, neither of these men needed to engage in insider trading. And yet (spoiler alert for anyone who hasnt read the business pages since 2011), in separate trials, juries convicted each of multiple counts of securities fraud. Investigators discovered that Rajaratnam had been given insider tips and used this advantage to make millions of dollars trading shares. Gupta was one of his sources. Rajaratnam received an 11-year sentence, the longest in American insider trading history; Gupta got two years. In one particularly dramatic instance, Gupta, on a conference call with Goldman Sachss board of directors one week after the collapse of Lehman Brothers, in 2008, learned that Warren Buffett was prepared to support Goldman with a $5 billion investment. Within minutes, Gupta called Rajaratnam and

Galleon purchased nearly $25 million of Goldman stock, mostly for Rajaratnams portfolio. The following month, when Gupta learned Goldman was about to report a loss, he called Rajaratnam 23 seconds later. Galleon soon began dumping Goldman stock. The cases against these two men are the twin pillars of Anita Raghavans true-life business thriller, The Billionaires Apprentice. Raghavan, a reporter who spent 18 years at The Wall Street Journal and has contributed to The New York Times DealBook, scoured documents and dissected testimony, adding color from more than 200 interviews on three continents. Her reporting is meticulous. The minutiae are instructive, though at times relentless. There is as much mens clothing here as at Barneys New York, and these two defendants really are what they wear: the roguish Rajaratnam in a white captains cap smoking pot on the upper deck of a yacht; the genteel Gupta in a black Nehru suit with a red handkerchief at President Obamas first state dinner. The books prefatory Cast of Characters sets a big, complex stage. My edition of Hamlet lists just 18 named dramatis personae at the outset, whereas The Billionaires Apprentice lists 81. For Wall Street insiders, there are large dollops of gossip about the bit players. Preet Bharara, the United States attorney in Manhattan, idolizes Bruce Springsteen and calls his father a tiger dad. Judge Richard J. Holwell mispronounces the name of Goldman Sachss chief executive Lloyd Blankfein. Raghavans coverage is encyclopedic. Some readers will wish she had heeded Elmore Leonards advice and left out the parts

people tend to skip. But the details of the two cases support a larger edifice, what Raghavan calls the rise of the Indian-American elite. Vijay Prashad, a scholar who has written extensively about South Asian history and Indian immigration, argues that men like Rajaratnam and Gupta benefited from two of the greatest social movements of the past century: independence in India and the struggles for civil rights in America. Those were the changes that made them twice blessed.
Nevertheless, as Raghavan shows, it took time and work for this new generation of South Asians to penetrate American financial firms. Rajaratnam was the only Sri Lankan in his class at Wharton, and Gupta had perfect grades after his first term at Harvard but couldnt get a job. One McKinsey source recalled how a partner asked, Will our senior clients ever relate to you? As Rajaratnam explained in a 2011 interview with Newsweek: Wall Street was tough to get into for us. Not to be crude but theres a Jewish mafia, and a WASP mafia, and an Irish mafia. . . . They hire their own; they socialize among their own.

The barriers fell slowly, man by man. Anshu Jain, the co-chief executive of Deutsche Bank, joined Kidder, Peabody & Company in 1985. Arshad Zakaria, the brother of the journalist Fareed, joined Merrill Lynch in 1987. As finance became more mathematical, Wall Street firms began to hire skilled graduates, mostly men, from the ultra-competitive Indian

Institutes of Technology, which were run as pure meritocracies. The I.I.T.s are a beacon of excellence in an India bedeviled by cronyism and back-scratching, Raghavan writes. Indira Gandhi wanted her son to study at the I.I.T. in Delhi, but he couldnt get in; he went to Imperial College London instead.
I witnessed some of the transformation firsthand at Morgan Stanley in the 1990s. As my firm, traditionally a white AngloSaxon Protestant enclave, opened its doors to minorities, South Asian immigrants rushed in. In the derivatives group, my boss was Indian-American. His boss, Vikram Pandit, more recently the head of Citigroup, was Indian-American. One of our junior colleagues, now a partner at Goldman Sachs, was IndianAmerican. The situation at other firms was similar. As Raghavan shows, this shift in ethnic composition was a widespread phenomenon. Indian-Americans populate every aspect of this story. On the government side, Preet Bharara oversaw both trials. Sanjay Wadhwa, a dogged securities investigator, connected the dots. On the private sector side, Rajaratnam created a South Asian network of tipsters and rogues whose debauchery makes Morgan Stanley look like a nunnery. Rajaratnam offered

thousands of dollars to anyone who could finish 10 tequila shots in a row or eat an entire loaf of bread without taking a drink of water. The alcohol, drugs and locker room antics are worthy of a Bollywood version of Animal House, starring Raj Rajaratnam instead of John Belushi. Ultimately, the story has an Indian-American Judas as well: Anil Kumar (charcoal suit, white shirt and blue tie), another successful Indian immigrant who attended Wharton with Rajaratnam and was Guptas protg at McKinsey. Kumar was the governments star witness, explaining how Rajaratnam wired money to an offshore bank account in the name of Kumars housekeeper in exchange for inside information as much as a million dollars for one tip. Kumar also testified against Gupta, his longtime friend and mentor. Gupta once a corporate rock star, according to Raghavan fell further than anyone, from the boards of Goldman Sachs, Procter & Gamble, American Airlines and numerous nonprofits. Pending appeal, he is most likely headed to the Federal Correctional Institution in Otisville, N.Y., presumably the inspiration for the Otis Federal Prison that housed Gordon Gekko for eight years. Like Gekko, Gupta remained classy until the end. When he surrendered to the F.B.I., he was impeccably dressed in a blue suit and salmon-colored Herms tie. In addition to setting forth the record of these two pathbreaking cases, The Billionaires Apprentice raises important policy issues. Of particular note, although federal prosecutors frequently use wiretaps to target street crime and terrorism,

Rajaratnams trial was the first time the government employed on-tape conversations to prove insider trading. Gupta used at least 13 different phones, and without the wiretaps the cases against both men probably would have failed. But the use of wiretaps in prosecutions of financial crime is contested territory; Rajaratnams lawyers asked a court to set aside his conviction, arguing that the wiretaps violated his constitutional right to privacy. (To which one might ask: Why should society value the privacy of securities traders so much more than that of urban youth? And given how much the government has been intruding into all aspects of our private lives, why didnt it use its wiretap power to prosecute fraud related to the subprime mortgage meltdown?) The Billionaires Apprentice is not without flaws. The title is confusing: Rajaratnam is the books billionaire, but Gupta, the other major player, was an experienced elder, not an apprentice. (The word accomplice would have made more sense, befitting both Gupta and Kumar.) Some names are misspelled: the 1965 immigration laws co-sponsor was Representative Emanuel Celler, not Cellar. Many sources are anonymous and quotes recreated. And although Jeffrey Skilling the former chief executive of Enron and convicted felon is a brilliant man, he is not the ideal source to cite repeatedly as an expert, especially on such issues as whether Rajat Gupta was transparent and trustworthy. Yet these are quibbles, and the guts of the book are the best form of journalism, an early draft of history. Although the bulk of the evidence wont be new to anyone who followed the media

coverage of the two trials, it is useful to have the details compressed into one volume. More important, the overall picture of Wall Street that emerges is more diverse and complex than the prevailing image of a decade ago. Today, every aspect of finance even insider trading and its prosecution requires greater technical skills and smarts than it did in the past. As financial innovation has accelerated, the rocket scientist graduates of technical schools have obtained a comparative scientific advantage. The good guys are now more ethnically and culturally varied. And so are the bad ones. When Israel has prostitutes and thieves, David Ben-Gurion reportedly said, well be a state just like any other. Anita Raghavans comprehensive account shows that the quip, which she cites, applies to other crimes and other places. On Wall Street, South Asia has finally arrived.