NEW YORK Goldman Sachs Chief Executive Lloyd Blankfein was interviewed under oath last week as a witness in the insider-trading case of Rajat Gupta, a former Goldman director and onetime global head of McKinsey & Co, according to court documents filed on Friday.
Blankfein was asked in a day-long February 24 deposition whether or not he knew others at Goldman had been interviewed by U.S. prosecutors about the Gupta case. His answer was not included in a partial transcript entered in the court record.
The transcript shows Blankfein was asked about help he received from federal prosecutors to prepare for the deposition in the case of Gupta, whose criminal trial is scheduled to start on May 21 in U.S. District Court in New York.
Gupta, the best-known corporate executive accused in a sweeping prosecution of insider-trading at hedge funds in recent years, denies the charges against him.
Blankfein, the head of Wall Street's most influential firm, was also asked about the company's code of business conduct and ethics; a July 28, 2008 Merrill Lynch analyst report on Goldman; and conversations between Goldman directors and clients.
"Have you learned whether or not other people at Goldman Sachs besides yourself have been interviewed by representatives of the prosecution in connection with this matter?" Gupta's main lawyer, Gary Naftalis, asked Blankfein during the deposition at the defense lawyer's offices.
Blankfein's lawyer, Steven Peikin, interrupted to say "most of this will tread into a privileged area. You can't ask a question that elicits privilege," according to the transcript.
The rest of the exchange is not included on the court record of the transcript, which has large omissions, jumping from page 24 to 32 and then from page 33 to 112.
A Goldman spokesman, Michael DuVally, declined to comment on the Blankfein deposition. Neither Goldman Sachs, Blankfein, nor other company executives are accused of any wrongdoing in the government's insider-trading investigation.
Gupta is fighting charges that he tipped his former friend, Galleon hedge fund founder Raj Rajaratnam, with Goldman and Procter & Gamble boardroom secrets between 2007 and 2009. Rajaratnam is serving an 11-year prison sentence for his conviction last May on 14 insider trading charges.
Before going to serve on various corporate boards, Gupta was the global head of the McKinsey & Co consultancy.
Blankfein testified for the government at Rajaratnam's trial. He is also expected to be called as a witness by the government at Gupta's trial.
In his deposition, the Goldman CEO was also asked whether other Goldman board members had independent relationships with large investors in the firm.
"I can't think of it, but inevitably," Blankfein said.
The names of Blankfein and other top executives came up in court last November as people who could be deposed as part of preparations for Gupta's trial.
The deposition transcript was included in a flurry of letters made public on Friday by federal prosecutors, lawyers for the U.S. Securities and Exchange Commission and Gupta's lawyers.
Defense lawyers argue that the Department of Justice and the SEC are investigating jointly and therefore materials from both agencies should be made available to Gupta, especially if it exculpatory for Gupta.
Goldman Sachs, in an annual 10-K filing with the SEC on Tuesday, included an item "Insider Trading Investigations" that did not appear in regulatory filings a year ago or at the end of the third quarter.
"It is the firm's practice to fully cooperate with any such investigations," the filing said.
A person familiar with the Gupta case said on Wednesday that prosecutors are investigating David Loeb, a managing director of Goldman Sachs. Loeb works with technology hedge-fund employees, including an Asia-based analyst, Henry King, who is also under investigation, according to another source briefed on the case.
The sources declined to be identified because the matter is not public. Neither Loeb nor King have been accused of any wrongdoing. Goldman declined comment and neither man responded to email requesting comment.
The cases are USA v Gupta in the U.S. District court for the Southern District of New York No. 11-907 and U.S. Securities and Exchange Commission v Gupta et al in the same court, No. 11-07566.