A New York jury at an insider-trading trial has heard the lone recorded phone call of an ex-Goldman Sachs board member speaking with a billionaire hedge fund founder.
The tape was played Wednesday at the conclusion of the third day of the trial of prominent businessman Rajat Gupta. He's accused of helping Raj Rajaratnam make millions of dollars through inside tips about Goldman Sachs and Procter & Gamble Co.
Gupta sat on the boards of both companies when prosecutors say he fed the information to his friend in 2007 and 2008.
Prosecutors argue Gupta spoke about confidential information he wasn't allowed to share with outsiders. Defense lawyers countered the information was already widely discussed publicly by Goldman executives.
Rajaratnam’s former secretary, Caryn Eisenberg, was the first witness called by the prosecution. She testified Rajaratnam was in a better mood after talking to Gupta on September 23, 2008, as WNYC reported:
"He was smiling more," Eisenberg said.
Within minutes, Rajaratnam's traders at the Galleon Group were being urged by managing partner Gary Rosenbach to buy Goldman Sachs, Eisenberg said. There were just a few minutes left before the end of the trading day at 4 p.m.
Eisenberg said she didn't know the content of Rajaratnam's conversation with Mr. Gupta — the door to her boss' office was closed. But government lawyers hope the circumstantial evidence from this phone call, and several others, will lead the jury to a guilty verdict.
Rajaratnam is serving an 11-year prison sentence for insider trading.