Millennium Post

'Gupta secretly served as Galleon executive'

Seeking to prove that ex-Goldman Sachs director Rajat Gupta benefited from his relationship with Raj Rajaratnam, prosecutors have claimed that the Indian-American was secretly serving as a top executive of the the convicted hedge fund founder's Galleon group.

Testifying for the government on the eighth day of 63-year-old Gupta's insider trading trial on Thursday, former marketing executive at Sri Lankan native Rajaratnam’s Galleon hedge fund Ayad Alhadi disclosed that Gupta had been secretly serving as a Galleon executive.

Alhadi told jurors about a 28 March 2008 meeting in Rajaratnam's office, where the Galleon co-founder said Gupta ‘would be the new chairman of Galleon International’ and responsible for investments outside the US.

Alhadi said Gupta may not have been officially named Galleon International chairman.

According to prosecutors, Rajaratnam had also awarded Gupta an ownership stake in Galleon but during cross examination by defence lawyer Robin Wilcox, Alhadi said he ‘never received notice that it was consummated.’

Alhadi said he had joined Gupta on a two-day marketing trip beginning March 31, 2008 to the United Arab Emirates where Gupta ‘was going to be helping Galleon meet prospective investors’ like the Abu Dhabi Investment Authority and the Emirates Bank.

‘I introduced him the way he was introduced to me, the new chairman of Galleon International,’ Alhadi said.

Prosecutors offered the evidence to highlight the business relationship between Gupta and Rajaratnam to counter the defence's claims that there was a falling out between the two men.

The government is seeking to prove that since Gupta and Rajartanam had business dealing together, Gupta had a motive to pass insider information to the Sri Lankan native, who is currently serving an 11-year prison term after being convicted of insider trading charges.
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