Rajat Gupta's alleged tips were publicly known: Defence
New York: Lawyers of Rajat Gupta, former Indian American director of Goldman Sachs Group, have questioned the prosecution charge that he leaked secret tips to convicted hedge billionaire Raj Rajaratnam by suggesting the alleged information was publicly known.
Cross examined Friday by defence lawyer Gary Naftalis at Gupta's trial on insider trading charges in Manhattan federal court, Goldman CEO Lloyd Blankfein acknowledged that senior firm executives had briefed outside analysts in July 2008 on the likelihood that Goldman Sachs would acquire a bank.
"Items that your senior management disclosed to analysts are no longer confidential?" Naftalis asked.
"Yes," Blankfein responded.
Questioning an allegation that Gupta leaked tips on Oct 23, 2008, about Goldman Sachs's unprecedented losses after learning of them at a meeting that afternoon, Naftalis confronted Blankfein with a news iten published that morning disclosing Goldman's plans, as-yet unannounced, to cut 10 percent of its staff.
Blankfein acknowledged that board members had probably been briefed about losses as early as Oct 13, but didn't recall the news story or the voice mail he distributed to the firm's 32,500 employees after the report came out.
In court, Naftalis had Blankfein read part of the transcript of the voice mail, including the sentence, "We regret that many of you heard of this decision from news accounts."
US prosecutors rested their insider-trading case against Gupta Friday following 13 days of testimony from 20 witnesses.
Galleon hedge fund co-founder Rajaratnam was convicted of insider trading last year and is serving an 11-year prison sentence.