A Funny Thing Happened in the Middle of U.S. v. Gupta

And it had nothing to do with Lloyd Blankfein, the Goldman Sachs chief executive officer whose presence in Judge Jed Rakoff’s courtroom last week lent a few light moments to what has been a tedious undertaking. No, we’re talking about news that Mark Schwartz, the banker who headed Goldman’s Asian operations from 1999 to 2001, is returning to the firm as vice chairman and head of Goldman Sachs Asian Pacific.

What’s funny about that? If you’ve been following the trial at all, you know that the government’s insider-trading case against Rajat Gupta hangs in large part on charges that the former McKinsey & Co. CEO used his standing on Goldman’s board of directors to pass lucrative secrets to Raj Rajaratnam.

And if you’ve been following the case especially closely, you may know that in 2006, after leaving Goldman, Mr. Schwartz helped found an investment fund called Taj Capital—later renamed New Silk Road—the same fund that counted Raj Rajaratnam and Rajat Gupta among its investors.

Which, of course, is not to say that Mr. Schwartz was mixed up with either of those scoundrels. As The New York Times reports, Mr. Schwartz left New Silk Road almost as soon as he got there—his tenure was so brief that Goldman didn’t mention its press release today. (Short tenure had to be it, right?) But in a trial sometimes short on entertainment value—we miss you Lloyd!—you take it where you can.

Meanwhile, in more pertinent Southern District news, Judge Rakoff disallowed a pair of wiretaps that Mr. Gupta’s defense had hoped would show that a Goldman executive named David Loeb had supplied Mr. Rajaratnam with inside dope. In turn, the defense rested, and closing arguments begin tomorrow.

A Funny Thing Happened in the Middle of U.S. v. Gupta