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Warren Buffett 's investment in Goldman Sachs Group Inc. in September 2008 was soconfidential that even his chief financial officer was unaware ofit before being briefed on the details by a Goldman Sachsexecutive, a witness at the Rajat Gupta trial testified. Byron Trott , who was vice chairman of investment banking at Goldman Sachs andthe architect of the $5 billion investment by Buffett's Berkshire Hathaway Inc. , testified Wednesday at Gupta's insider-trading trial.Prosecutors, who called Trott as a witness, claim that Gupta, thena Goldman Sachs director, tipped Galleon Group LLC co-founder Raj Rajaratnam before the Buffett deal became public on Sept. 23, 2008. "It was a major, major event to Goldman Sachs and to the markets,"Trott told jurors in Manhattan. "$5 billion was not easily found atthat time." Prosecutors summoned Trott to tell jurors about the secrecysurrounding a deal that came soon after the collapse of Lehman Brothers Holdings Inc. and while the markets were in free-fall. At the time, GoldmanSachs needed at least $5 billion to "continue to exist," he said. "Our entire foundation was built on confidential information, andit could never be breached," said Trott, who left Goldman Sachs in2009 after 27 years at the bank. He said he operated on a"need-to-know basis." Berkshire CFO Gupta, a Westport resident who ran the consulting firm McKinsey &Co. from 1994 to 2003, is accused of passing multiple insider tipsto Rajaratnam in a conspiracy that ran from 2007 to January 2009.Rajaratnam is serving an 11-year prison sentence for insidertrading. Gupta denies wrongdoing. Prosecutors have said Gupta, 63, leaked inside information toRajaratnam about New York-based Goldman Sachs and Cincinnati- based Procter & Gamble Co. , the world's largest consumer- products company. Gupta, who was adirector at both companies, is charged with conspiracy andsecurities fraud. Also Wednesday, at a hearing outside the jury's presence, AssistantU.S. Attorney Reed Brodsky said that another Goldman Sachs executive, David Loeb , was heard on a government wiretap passing information toRajaratnam. Brodsky told U.S. District Judge Jed Rakoff that Loeb passed tips about Intel Corp., Apple Inc. and Hewlett-Packard Co. Brodsky made his remarks after defenseattorney Gary Naftalis complained that prosecutors withheld evidence about Loeb.Prosecutors denied that allegation. Loeb hasn't been charged withwrongdoing. Intel, Apple "Mr. Loeb, the evidence will show, provided Intel, and Apple andHewlett Packard information to Mr. Rajaratnam," Brodsky said,adding that the tips allegedly passed by Loeb were different fromthose Gupta is accused of leaking. The defense "wants to blow thisup and confuse the jury," Brodsky said in response to Naftalis'scomments about Loeb. Michael DuVally , a spokesman for Goldman Sachs, declined to comment on thestatements about Loeb. Before that exchange, Trott became the third witness to describeevents that preceded Galleon's purchase of 267,000 shares inGoldman Sachs in the minutes before the stock market closed onSept. 23, 2008. Testifying about a "time of turmoil" and "fear" in the markets,Trott told jurors that he twice reached out to Buffett to seewhether he'd be willing to invest in Goldman Sachs. Buffett, withwhom Trott had a "special relationship," rejected a first overturebut was receptive to a renewed request on Sept. 22 of that year, hesaid. Seal of Approval The second proposal had terms closer to Buffett's liking, including$5 billion in preferred stock carrying a 10 percent interest rateand the right to buy common shares of stock in a new publicoffering. Buffett also insisted that top Goldman Sachs executivesnot sell their own shares. "Was this discussion confidential?" Brodsky asked. "Very," said Trott, who was based out of Chicago and working out ofNew York at the time. Trott said that winning Buffett's investmentwas "like getting the Good Housekeeping seal of approval." They hammered out the deal in a 20-minute telephone call on Sept.23 in which Trott said he wanted Buffett to be the "cornerstone" ofthe transaction. After they reached a tentative agreement, Buffetttold Trott not to telephone until later that afternoon because hehad an important appointment. "He told me he promised his grandkids to take them to Dairy Queen,and he was not to be interrupted," Trott said. The e-commerce company in China offers quality products such as Honda DVD Navigation System Manufacturer , China FIAT DVD player, and more. For more , please visit Automobile DVD Players today!
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