Gov. Piyush Jindal spent all of one year in the private sector during his meteoric career.

That year of proximity to one Rajat Gupta could come back to bite him on the backside as a major political embarrassment.

Back in 1995 when he was 24 and fresh out of college, Jindal worked for the conservative consulting company McKinsey and Co.

It was during his tenure there that McKinsey presented Allstate Insurance with an elaborate plan detailing how Allstate could increase profits by denying fair settlements of home, business and auto claims. Basically, the strategy, according to McKinsey’s plan, was to switch from the “Good Hands” treatment to the “Boxing Gloves” treatment if claimants persisted in seeking equitable settlements.

It was a strategy that would serve Allstate well in the aftermath of Hurricanes Katrina and Rita as its profits soared from $82 million per year to more than $2 billion per year.

The consulting firm had other low water marks it would probably just as soon forget:

• McKinsey, in 1980, advised AT&T that cellular phones would be a niche market at best.

• The consulting company advised Swissair to gobble up small airline services instead of entering into cooperative agreements with them. Swissair followed that sage counsel and 12 years later entered into bankruptcy.

• McKinsey recommended to the Minneapolis Public School System that it could cut costs by eliminating teacher health care. In what has become an increasingly familiar trend, the firm also recommended converting 25 percent of schools that scored the lowest on standardized tests to privatized charter schools.

• Enron was one of McKinsey’s biggest clients before it went belly-up, costing hundreds of employees their jobs, their pensions and their health care benefits. Enron CEO Jeff Skilling, who was sentenced to 24 years in federal prison as a result of Enron’s collapse, was formerly a partner at McKinsey.

In 1994 Rajat Gupta was named to head up McKinsey. During his tenure, the firm quickly expanded its global influence as it moved aggressively into the emerging markets of India and China.

It was in 1995, a year after Gupta took over the helm of McKinsey, that young Piyush was brought on board putting Gupta in position to be something of a mentor to his fellow Indian-American.

Last Friday, June 15, Gupta, also a former Goldman Sachs and Procter & Gamble board member, was found guilty of passing insider information about Goldman Sachs to Raj Rajaratnam, manager of the hedge fund Galleon Group.

Gupta was convicted on four of six counts of passing confidential information to Rajaratnam, who was himself convicted earlier and is currently serving an 11-year sentence after raking in more than $50 million on insider trading.

Gupta, who was found guilty of three counts of securities fraud and a single count of conspiracy, is facing 10 years in prison. His sentencing is scheduled for later this year.

Only two days after Gupta’s conviction, CBS’ 60 Minutes re-ran a story about congressional insider trading.

The segment featured an interview with former Congressman Brian Baird (D-Wash.), who fought unsuccessfully during his 12 years in Congress to pass legislation outlawing insider trading by members of Congress.

Baird pointed out that insider trading is against the law for executives, attorneys, financial consultants and any other warm body in America—except members of Congress, who are, incredulously, exempt.

Which brings us back to Piyush Jindal.

Soon after losing his first gubernatorial race to Kathleen Blanco in 2003, Jindal decided to run for Louisiana’s First Congressional District seat then being vacated by David Vitter, who would run successfully for retiring John Breaux’s U.S. Senate seat.

Jindal won that 2004 race and took office in January of 2005. His financial report for 2004 indicated a net worth between $935,000 and $2.7 million, largely on the basis of 73 trades.

One year and 95 investment transactions later, his net worth was given as between $1.2 million and $3.2 million, an increase of between $300,000 and $500,000, according the Center for Responsive Politics.

By 2006, he logged 105 transactions and increased his net worth from a range of $1.5 million to $3.9 million—on a salary of $165,000 per year, another uptick of between $300,000 and $500,000.

The bulk of his transactions were investments made through Legg Mason Asset Management, though he also had investments through Fidelity Growth, Merrill Lynch and other companies as well. There was no indication as to what the specific investments were but each of the firms advertises a full line of investments, including, money markets, mutual funds and separately managed accounts (SMA) and Merrill Lynch and Legg Mason also traded in hedge funds.

Jindal’s trading activity was in all probability legitimate and no one is suggesting otherwise. By its very existence, however, his trading activity might suggest that serious consideration be given to Baird’s efforts to outlaw active trading, particularly insider trading, by members of Congress who, by necessity, have access to sensitive market information that could give them and important edge in investment strategy.

It is a system that remains alluring for those who would abuse it and it should be corrected if, for no other reason, the appearance of propriety.