New York, May 26: A prosecution witness revealed a jam company’s secret plan code-named Project Moon as government sought to prove that as a director for Goldman Sachs and Procter & Gamble Rajat Gupta was spilling the beans about both.
Prosecution has alleged that Indian-American Gupta told convicted hedge fund billionaire Raj Rajaratnam about Procter & Gamble selling its Folgers Coffee brand to Ohio-based The JM Smucker’s Co., before the deal went public in June 2008.
Prosecution witness, Mark Belgya, Chief Financial Officer of Smucker’s, however, also told a Manhattan federal court Friday at the trial of Gupta on insider trading charges that the information about the acquisition was leaked to the media before the public announcement.
During cross-examination, Gupta’s lawyers tried to establish that the leak could have come from any of the employees of the banks and lawyers who were participating in forging the deal.
Earlier in the day, the prosecution played more wiretaps of Galleon hedge fund co-founder Rajaratnam discussing with his employees tips about Goldman Sachs that he allegedly received from Gupta.
Prosecution claims that after a Goldman Sachs board meeting on Sep 23, 2008, Gupta immediately phoned Rajaratnam to tell him that the investment bank was going to receive $5 billion from Warren Buffet’s company Berkshire Hathaway.
Records show that Gupta placed a call to Rajaratnam’s phone, but the prosecution does not have a recording of the actual conversation.
Carolann Shields, an employee at the McKinsey IT department, who tracks phone records at the consulting firm, said that a call from the conference room of the McKinsey office in New York was connected to Goldman Sachs boardroom on Sep 23, 2008.
This call very likely discussed the Buffett deal, according to the prosecution. Then, Shields said, at 3:55 pm another call from Gupta’s personal assistant went to Rajaratnam’s phone, which lasted for about 30 seconds.