Blankfein Testifies In Galleon Insider Trading Case
In calling Blankfein as a witness, prosecutors in the office of U.S. Attorney Preet Bharara in Manhattan said they don’t want Blankfein to be questioned about “whether Goldman Sachs is presently the subject of any pending investigations by either the Department of Justice or the U.S. Securities and Exchange Commission” and whether the bank bears any responsibility for the 2008 financial crisis.
Lloyd Blankfein, chief executive officer of Goldman Sachs Group Inc. (GS), testified at Galleon Group LLC co-founder Raj Rajaratnam’s insider-trading trial that former Goldman board member Rajat Gupta violated the firm’s confidentiality policies.
Blankfein took the stand as a witness for the prosecution before U.S. District Judge Richard Holwell in Manhattan federal court at about 10:30 this morning. He said Gupta violated Goldman policies when he revealed details of the firm’s strategic planning discussions to Rajaratnam in a wiretapped phone call in July 2008.
Prosecutors called Blankfein to help build their case that Rajaratnam traded on inside information about Goldman Sachs he obtained from Gupta. On the stand, Blankfein identified a photo of Gupta and said Gupta was on Goldman’s governance, audit and compensation committees.
Rajaratnam, 53, is in the third week of his trial in the largest crackdown on hedge-fund insider trading in U.S. history. The Sri Lankan-born money manager is accused of making $45 million from tips leaked by corporate insiders and hedge fund traders. He denies wrongdoing, saying he based his trades on research.
Rajaratnam got a tip from Gupta about a $5 billion investment in the firm by Warren Buffett’s Berkshire Hathaway Inc., and Gupta allegedly passed the news immediately to Rajaratnam, who bought shares, prosecutors told the jury in opening statements.
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Background:
Rajat Gupta: Timeline Of Insider Trading Case Against Former Goldman Sachs Director
Mar 23, 2011 at 4:26 PM
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http://www.hedgefund.net/publicnews/default.aspx?story=12318
http://in.reuters.com/article/2014/06/24/usa-insider-trading-rajaratnam-idINKBN0EZ2QO20140624
(Reuters) - A former Intel Corp executive on Tuesday, testifying in the insider trading trial of Rengan Rajaratnam, told jurors how he leaked details of a major deal to the former Galleon Group portfolio manager's brother, Raj Rajaratnam.
The testimony by Rajiv Goel, a former friend of Raj Rajaratnam, marked the first time jurors heard directly from an individual who prosecutors say provided illegal tips to the onetime hedge fund billionaire, who in turn allegedly passed the information to his younger brother.
Prosecutors played jurors a series of wiretapped phone conversations between Raj Rajaratnam and Goel, who testified that he spoke frequently with the Galleon founder about a $1 billion investment Intel planned to make in 2008 in technology company Clearwire Corp.
"The whole investment was confidential," Goel said.
Prosecutors accuse Rengan Rajaratnam, 43, of conspiring with his brother to trade on inside information about Clearwire and Advanced Micro Devices Inc in 2008. He faces three counts of conspiracy and securities fraud.
Raj Rajaratnam, 57, is serving an 11-year prison term after being convicted of securities fraud and conspiracy.
On cross-examination, Goel said he had never met Rengan Rajaratnam until a vacation in Italy arranged with Raj Rajaratnam following the deal...