Former Goldman director charged

March 1, 2011 at 5:34 PM

NEW YORK, March 1 (UPI) -- U.S. finance regulators said Tuesday insider trading charges were filed against Rajat Gupta, who has served on the board of directors at Goldman Sachs.

The Securities and Exchange Commission said Gupta, who is "a friend and business associate" of Galleon Management founder Raj Rajaratnam, also served as a board member of Procter & Gamble.

The SEC charged Gupta with "tipping" Rajaratnam with insider information about the quarterly earnings at both firms and about a $5 billion investment Berkshire Hathaway made with the New York bank.

The investment was made public in Sept. 23, 2008.

Rajaratnam and several others have already been charged in the widespread insider trading investigation.

SEC Director of Enforcement Robert Khuzami said, "Directors who violate the sanctity of board confidences for private gain will be held to account for their illegal actions."

The SEC said, "Gupta called Rajaratnam immediately after a special telephonic meeting at which Goldman's Board considered and approved Berkshire's investment in Goldman Sachs."

Minutes later, just before the close of markets, Rajaratnam used Galleon funds to by 175,000 Goldman shares, the SEC said.

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