The chief executive of Goldman Sachs, Lloyd Blankfein, made a rare courtroom appearance on Wednesday, testifying for the government in a high-profile insider trading trial.
Blankfein is the most powerful person to date to be called to the witness stand in the trial of Raj Rajaratnam, the founder of Galleon hedge funds who's accused of trading stocks based on secret information he received from friends -- one of whom sat on the board of Goldman Sachs.
During his more than three-hour testimony, Blankfein listened to a secretly recorded conversation between Rajaratnam and a former Goldman Sachs board member, Rajat Gupta. On the tape, the two men talked about the Goldman Sachs board discussing the possible acquisition of a commercial bank or insurance company in the summer of 2008.
When asked whether Gupta violated Goldman's confidential policy on that call, Blankfein said yes.
Rajaratnam's lawyer, John Dowd, said the information exchanged on the call had already been rumored in the media and that the hedge fund manager only traded on public information and good research.