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Goldman
Sachs Chairman and CEO Lloyd Blankfein testifies before the
Senate Homeland
Security and Governmental Affairs Investigations
Subcommittee hearing on ''Wall
Street and the Financial Crisis: The Role of
Investment Banks'' on Capitol Hill
in Washington April 27, 2010.
(Credit: Reuters/Jason Reed)
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(Reuters) -
Goldman Sachs Group Inc Chief Executive Officer Lloyd Blankfein may be asked to
testify in a market regulator's insider-trading case against a former director
of the Wall Street bank, a judge ruled.
The U.S.
Securities and Exchange Commission has accused Rajat Gupta, a former board
member at Goldman and Procter & Gamble, of giving inside tips about the two
companies to his friend Raj Rajaratnam in 2008 and 2009.
Rajaratnam,
founder of the Galleon Group hedge fund, was convicted of 11 criminal counts in
May. Blankfein testified for the prosecution at that trial.
Gupta
denies the charges in the SEC's civil lawsuit. He also is contesting criminal
insider-trading charges brought by the U.S. Attorney's Office in Manhattan.
U.S.
District Judge Jed Rakoff identified Blankfein and six others, including some
former Galleon traders, as people who could be interviewed under oath in the
SEC case. The written order was dated Tuesday.
Goldman
Sachs spokesman David Wells declined to comment.
Gupta's
lawyer, Gary Naftalis, had told the judge he wanted to depose Blankfein and
other Goldman executives.
The judge
has scheduled start dates of April 9 for Gupta's criminal trial and October 1
for the civil trial. Rajaratnam is also a defendant in the SEC case against
Gupta.
Typically,
when there are parallel cases by the SEC and the Department of Justice, the
regulator's case is suspended until the end of the criminal trial.
However,
Rakoff's order said there was "sufficient time after the completion of the
criminal case to complete all discovery while at the same time assuring that
the parallel civil case will go forward to trial promptly."
The cases
are SEC v Gupta and Rajaratnam, U.S. District Court for the Southern District
of New York, No. 11-07566, and USA v Rajat Gupta, No. 11-907, in the same
court.
(Reporting
by Grant McCool; Editing by Lisa Von Ahn)
Related Articles:
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The SEC says that information from Mr Gupta helped
convicted trader Rajaratnam make millions of dollars (BBC)
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