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As Defense Rests in Rajat Gupta Insider Trading Trial, Goldman CEO Lloyd Blankfein Offers Business Tips

Tuesday, June 12, 2012

Goldman Sachs Chairman and CEO Lloyd Blankfein touted the big bank’s small business program on Tuesday — less than a week after appearing as a prize government witness in the insider trading trial of a former Goldman board member Rajat Gupta.

Speaking on MSNBC’s “Morning Joe” Tuesday, Blankfein, flanked by Warren Buffett, offered tips for graduates of his 10,000 Small Business program.

“Some of the information that comes out of courses is not designed to make people more conservative, but to have people avoid the mistakes of getting themselves over-leveraged so they lose control of their idea,” he said.

Buffett added: “The key to running a successful business is happy customers.”

Meanwhile, the defense has rested in the insider trading trial of Rajat Gupta, a former Goldman board member. Closing arguments are set for Wednesday in federal court in Manhattan, with deliberations expected to start on Thursday.

Blankfein took the stand in federal court in Manhattan last week, saying he initially planned to force Gupta off the board in 2008 because of a conflict of interest. Instead, he was asked to stay on due to the economic crisis.

An investment involving Goldman Sachs is key to the prosecution's insider trading trial, as WNYC reported:

Prosecutors allege that on several occasions Gupta, who served on the board of directors at Goldman Sachs and Procter & Gamble, passed on confidential information to Raj Rajaratnam, the founder of the Galleon hedge fund.

One such tip from September 2008 was that Warren Buffett planned to purchase Goldman Sachs shares worth $5 billion, a move that was not publicly known. Rajaratnam then used the information to execute stock trades that would make money for Galleon.

Gupta has pleaded not guilty to the charges.

 

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