By Grant McCool
NEW YORK (Reuters) - Prosecutors played secretly recorded audiotapes they argue show that one-time hedge fund billionaire Raj Rajaratnam discussed confidential details of a deal involving Advanced Micro Devices Inc with a high-ranking friend at consulting firm McKinsey & Co.
In the first day of testimony in one of the biggest insider trading trials in years, a Manhattan federal jury heard excerpts from the tapes while a prosecutor questioned an FBI agent who had listened to the wiretaps. The agent testified that the calls involved Rajaratnam.
"Hi. So yesterday they agreed on, at least they've shaken hands and they've said they are going ahead with the deal," former McKinsey executive Anil Kumar is heard saying in an August 15, 2008, phone call recorded by the FBI.
Rajaratnam is heard responding "Uh huh." Kumar is then heard on the digital recording saying, "there will be such a boost from this announcement, it'll be fine."
Rajaratnam, founder of the Galleon Group hedge fund, then is heard saying, "Right. What's the deal? How much are they investing?"
Prosecutors contend that Rajaratnam and Kumar were discussing a deal by chipmaker Advanced Micro Devices with Mubadala, an Abu Dhabi government investment fund. Mubadala currently has a stake in AMD.
Parts of the excerpt of the call were inaudible. The entire call lasted more than two minutes.
The defense has not yet had an opportunity to respond to the recordings played in court on Thursday. Defense lawyer John Dowd said in his opening statement on Wednesday that his client used only public information in his research and trading.
Rajaratnam, 53, was arrested in October 2009 in a massive insider trading probe that shook the secretive $1.9 trillion hedge fund industry. Nineteen people have pleaded guilty in the case. Rajaratnam has pleaded not guilty and vowed to clear his name at trial.
FBI agent Diane Wehner was the first witness in the trial, which is expected to last about two months. She described for the jury the mobile telephone surveillance of Rajaratnam and of Kumar, former Intel Corp executive Rajiv Goel and others who will testify against Rajaratnam at trial.
Kumar is expected to testify later on Thursday.
Wehner said she became familiar with Rajaratnam's voice "through multiple overhears during eight or nine months the wiretap was up" in 2008.
The case is USA v Raj Rajaratnam et al, U.S. District Court for the Southern District of New York, No. 09-01184.
(Additional reporting by Basil Katz; editing by John Wallace)