Gupta Lawyers Cite Fourth Goldman Insider Under Probe

by The Compliance Exchange on April 20, 2012

Federal prosecutors preparing for the insider-trading trial against former Goldman Sachs Group Inc. GS 0.00% director Rajat Gupta have disclosed a fourth alleged Goldman insider under investigation.

The Wall Street Journal previously reported that federal prosecutors were investigating two other Goldman employees, in addition to Mr. Gupta, according to people familiar with the matter, as part of its investigation into the former Goldman director accused of passing inside information to Galleon Group hedge-fund founder Raj Rajaratnam.

Mr. Gupta, who has denied any wrongdoing, is scheduled to go on trial in May.

Gary Naftalis, the lead attorney representing Mr. Gupta, said in court Thursday that prosecutors informed him late Wednesday night that federal prosecutors in Los Angeles were investigating another Goldman employee for passing inside information about two public companies to Mr. Rajaratnam.

He didn’t name the Goldman employee or the companies in question. It is unclear whether this person is a current employee of Goldman. Goldman declined to comment.

“We obviously would request the government to get us any and all information relating to this additional source that Mr. Raj Rajaratnam had at Goldman Sachs of nonpublic information as soon as possible,” Mr. Naftalis said in court.

Read the full story at the WSJ.

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