Brijesh Goel was convicted of conspiracy, securities fraud and obstruction of justice
Washington:
A former Goldman Sachs Group Inc. banker was found guilty of passing inside information on deals to a once-close friend and squash partner who became the prosecution’s star witness.
Brijesh Goel was convicted Wednesday of tipping off former Barclays Plc trader Akshay Niranjan about deals at Goldman.Mr Niranjan made some $280,000 in illegal profits trading on the information but later flipped on his friend, recording their conversations and cooperating with federal investigators before taking the stand at Goel’s trial in Manhattan federal court.
Jurors returned the verdict after only a few hours of deliberation. Goel put his head down as the jury foreman read the verdict, and his lawyers put their hands on his back in support. He continued to look down as the judge gave farewell remarks to the jurors.
The trial, which began June 12, offered a striking portrait of a close Wall Street friendship torn asunder amid federal scrutiny. According to Goel’s lawyers, it was “the ultimate betrayal.”
Niranjan described the two men’s friendship in great detail on the stand, telling the jury how they met at University of California, Berkeley’s business school and then both moved to New York to take on prestigious Wall Street jobs. In addition to playing squash, the two smoked marijuana almost every weekend and traveled to music festivals together, Niranjan said.
It was on the squash court that Goel offered his first insider tip, telling his friend to buy options in Lumos Pharma Inc., Niranjan testified. There were seven other deals Goel gave him information on from 2017 to 2021.
By spring of last year, both men had been contacted by the Federal Bureau of Investigation. Niranjan chose to cooperate and recorded two June 2022 meetings with Goel in the stairwell of the Lower Manhattan building where they both lived. Jurors heard the conversations, partly in Hindi, in which Goel asks Niranjan to delete texts between the two.
“F–… This we need to delete,” Goel said in one recording. “Did we put on any trade?… It has to be deleted. I don’t even have this chat.”
Goel testified in his own defense, claiming Niranjan set him up. According to Goel, Niranjan traded on information he overheard and then made up a story about insider trading to avoid punishment.
Jurors rejected Goel’s attempt to explain his side. He now faces prison and likely deportation to his native India. US District Judge Kevin Castel set an Oct. 19 sentencing, allowing Goel to remain free until then.
Goel was convicted of conspiracy, securities fraud and obstruction of justice, for destroying messages on Niranjan’s phone. The fraud and obstruction counts carry a maximum penalty of 20 years in prison, though he’s like to be sentenced to much less.
Despite admitting to his role in the scheme, Niranjan won’t be prosecuted, under an agreement with the government. Both men also lost their jobs after the criminal case was announced in July 2022 – Goel had joined Apollo Global Management from Goldman the year before.