A former Goldman Sachs Group Inc. vice president testified that he never passed confidential tips to a friend who says they conspired to make thousands of dollars by trading on inside information.
In an unusual move in fraud trials, Brijesh Goel took the stand in federal court in Manhattan Friday. He defended himself against testimony by his friend Akshay Niranjan, the government’s star witness.
Niranjan explained over three days how they made approximately $280,000 in illegal profits by trading on confidential information provided by Goel. The trial, which started last week and has pitted the two bankers against each other, has revealed even the best of friendships can shatter under the pressure of a federal investigation.
Goel wasn’t required to testify and the decision carries risks. He opens himself up to cross-examination by prosecutors who will try to trip him up on his testimony, but he can also try to explain seemingly inculpatory evidence such as a conversation Niranjan recorded in secret, capturing his friend allegedly asking him to delete incriminating text messages.
“This we need to delete,” Goel said in the recording. “Did we put on any trade?... It has to be deleted. I don’t even have this chat.”
But Goel testified the conversation wasn’t what it seemed.
“I panicked,” Goel said “I thought he had done something stupid. I thought because of his stupidity he’s going to be in trouble and I’m going to be in trouble too. There was a lapse of judgment.”
Goel and Niranjan were buddies who met in business school at the University of California in Berkeley and later became close friends after landing top jobs at Wall Street firms. Niranjan agreed to cooperate with the government as part of a deal not to prosecute him.
The two lived in the same building on Spruce Street in lower Manhattan. Goel said he attempted to contact Niranjan multiple times without success, following an FBI visit that left him feeling rattled.
In one attempt to convince Niranjan to meet him, Goel had the building’s staff call Niranjan and ask him to bring down his “swim cap.”
“I had naively thought I was in this investigation and this mess because he was my friend,” Goel said.
Goel’s lawyers have argued that Niranjan eavesdropped on Goel’s work calls with Goldman colleagues during social outings, and traded on what he heard about mergers and acquisitions in the pipeline. It wasn’t Goel who misappropriated the information, they said.
Niranjan admitted that Goel did take business calls sometimes when they were out with friends, but he said Goel usually would go away from the group to conduct his business.
“I did not listen, I was not trying to listen in,” he said. “I did not ever do that.”
The case is US v. Goel, 22-cr-00396, US District Court, Southern District of New York (Manhattan)
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Author: Chris Dolmetsch, Teresa Xie and Greg Farrell
