Jurors at the insider trading trial of a hedge fund manager listened on Monday to more wiretaps that prosecutors say show he was brazenly trading on secret information about pending technology industry deals to help make himself one of America's wealthiest businessmen.
Prosecutors have made a slew of FBI-recorded phone calls by Raj Rajaratnam the centerpiece of what they call the largest hedge fund insider trading case in history. On a tape played Monday, Rajaratnam and disgraced Intel executive Rajiv Goel could be heard discussing a closed-door meeting in 2008 where the Intel board of directors agreed to invest $1 billion in a joint wireless venture by Sprint and Clearwire.
"Yesterday, our board approved the deal," Goel tells Rajaratnam.
"I see," Rajaratnam replies.
Asked if Goel was authorized to speak about the decision, another Intel executive called as a government witness said, "Absolutely not."
Rajaratnam, 53, of Manhattan, is charged with conspiracy and security fraud. He is the only one of more than two dozen people charged in the insider trading crackdown to face trial.
Nineteen defendants have pleaded guilty. Some are cooperating with the government, including Goel, who is expected to testify on Tuesday.
The government alleges that Rajaratnam earned more than $50 million illegally by trading on inside information since 2003. The investigation has led to another probe that targets those who pose as researchers in the securities industry as they pass secrets about public companies to hedge funds.
Last week, the jury heard testimony from a financial consultant who claims Rajaratnam paid him hundreds of thousands of dollars for inside tips. He testified that he followed the defendant's advice to stash the kickbacks in an offshore bank account under his housekeeper's name.
The defense told jurors during opening statements last week that its client had the best research in the business and did not need to trade illegally. On cross-examination, Rajaratnan's lawyers have confronted government witnesses with news reports they say show that he was using information that was already public.
Rjaratnam's network of hedge funds, Galleon Group LLC, shut down after his arrest.