Lloyd Blankfein, CEO of Goldman Sachs Group, testified at Galleon Group co-founder Raj Rajaratnam's insider-trading trial Wednesday that former Goldman board member Rajat Gupta had violated the firm's confidentiality policies.
Mr. Blankfein, testifying for the prosecution before U.S. District Judge Richard Holwell in New York, said Mr. Gupta violated Goldman policies when he revealed details of the firm's strategic planning discussions to Mr. Rajaratnam in a wiretapped phone call in July 2008.
Prosecutors called Mr. Blankfein to help build their case that Mr. Rajaratnam traded on inside information about Goldman Sachs he obtained from Mr. Gupta, then a Goldman board member. On the stand, Mr. Blankfein said Mr. Gupta was on Goldman's governance, audit and compensation committees.
John Dowd, Mr. Rajaratnam's lawyer, said he doesn't intend to question Mr. Blankfein about any pending investigations related to Goldman Sachs. He said he may recall Mr. Blankfein later in the trial as a witness for the defense. The parties didn't address whether Mr. Dowd may question Mr. Blankfein about Goldman's role in the 2008 financial meltdown.
Mr. Rajaratnam is in the third week of his trial in the largest crackdown on hedge-fund insider trading in U.S. history. The Sri Lankan-born money manager is accused of making $45 million from tips leaked by corporate insiders and hedge fund traders. He denies wrongdoing, saying he based his trades on research.