Lloyd Blankfein might testify as a government witness at Raj Rajaratnam’s criminal trial, the Wall Street Journal reported.
Rajaratnam’s long-awaited criminal trial begins next week. The former Galleon chief faces a series of insider trading charges including 14 counts of securities fraud and conspiracy.
According to the WSJ,
The U.S. would use Mr. Blankfein to establish evidence linking information about Goldman that was shared among board members and executives with former Goldman director Rajat Gupta, according to people familiar with the case. Prosecutors have alleged that Mr. Rajaratnam obtained inside information about Goldman in October 2008.
Earlier this week the SEC charged Gupta, a former Goldman board member, with insider trading. He’s alleged to have passed on material, non-public information about Goldman Sachs profits and Berkshire Hathaway’s $5 billion investment bank, seconds after disconnecting from telephone calls with Lloyd Blankfein and other board members, back in 2008.
Apparently Blankfein’s “testimony would be used as a bridge establishing the origin of the tip allegedly provided by Mr. Gupta to Mr. Rajaratnam,” the WSJ said.
Gupta has denied all the allegations.
But before every gets excited about something resembling a repeat of Blankfein’s congressional testimony about the financial crisis, a Blankfein appearance in the witness box isn’t a sure thing.Even though Lloyd has agreed to testify, that doesn’t mean he will definitely be called to the stand — “He could fall off the agenda, depending on how the trial proceeds.”
Also, Lloyd isn’t the only potential witness from the Goldman camp. “The government’s witness list includes numerous Goldman Sachs… representatives who will presumably provide testimony on the very issues in the S.E.C lawsuit,” Dealbook reported.