Colorful Testimony From ‘the Help’ at Gupta Trial

MANHATTAN (CN) - The former assistant to disgraced hedge fund executive Raj Rajaratnam told jurors Tuesday about her unlikely ascension from small-town party planner to key government witness in the largest hedge fund insider-trading scheme in U.S. history.

Caryn Eisenberg, who turned 30 in January, is the government's first witness against Rajat Gupta, a former Goldman Sachs board member who is on trial for feeding inside info to longtime associate Rajaratnam, the billionaire director of the Galleon hedge fund.

Eisenberg said Rajaratnam hired her as his assistant after her family friend gave her resume to the company's trader, Gary Rosenbach.

For the last decade prior to Galleon, Eisenberg had worked part-time for the Manalapan, N.J.-based event planning company It's Your Party.

Around the same time, she also earned a degree from the University of Arizona, widely known as a "party school" of the Southwest.

Gupta's attorneys flashed Eisenberg's incongruous resume on a large screen for jurors and spectators.

Prosecutors believe that the new job brought Eisenberg VIP access to a criminal conspiracy that unfolded at the heart of the September 2008 financial crisis.

Assistant U.S. Attorney Reed Brodsky, dubbed "Napoleon" for his pugnacity, led Eisenberg through a blueprint of her former Manhattan office at 590 Madison Ave., pointing a red laser pen at its high-security corridors.

Eisenberg said she needed to swipe through locked doors to pass through to the trading desks.

On Sept. 23, 2008, Rajaratnam sat at the wide corner office at the end of the trading area, where he would view financial data on eight computers and holler commands through a window at his top trader, Ian Horowitz, Eisenberg testified.

Inside another high rise that day, Goldman Sachs held a board meeting where it was announced that investor Warren Buffett would pledge $5 billion to restore public confidence in the company amid financial meltdown.

Prosecutors aim to prove that Gupta sat in on that meeting and passed the news onto Rajaratnam before the public knew.

Reviewing phone records, Eisenberg verified that Gupta's assistant Renee Gomes placed a call to Rajaratnam's direct line at 2:27 pm.

Although U.S. District Judge Jed Rakoff would not let Eisenberg speculate about Rajaratnam's emotional state after the call, the jurist allowed her to say she remembered seeing her former boss "smiling more."

Eisenberg also said that she remembered Galleon co-founder Gary Rosenbach entering Rajaratnam's office for a closed-door meeting toward the end of the stock market day.

After he stepped out, Rosenbach barked, "Buy Goldman Sachs!" a "few times" before the closing bell rang, she said.

The next day, she said, "everyone was still talking about it because it was a big deal in the financial world."

Eisenberg said she spent part of that day shopping at Bloomingdales.

Defense attorney David Frankel began cross-examination quizzing Eisenberg about the alleged coaching she received from government officials.

Acknowledging she met with prosecutors and FBI representatives multiple times, she testified that, days before the Gupta trial, she found the red spiral notebook where she kept the short list of "important people" afforded direct access to Rajaratnam's phone. She said she turned it over to the government on subpoena and reviewed other documents that they collected.

Eisenberg said that she refused invitations to meet with defense attorneys, however, on the advice of her attorney, who was seated in the courtroom.

While Eisenberg described Gupta as Rajaratnam's "friend," defense attorneys tried to undermine that comment with chats that seem to show her boss giving Gupta the cold shoulder.

On the morning of Feb. 29, 2008, Eisenberg said that she had to cover phones for her colleague, Anita Teglasi. In an Internet chat with Teglasi that afternoon, Eisenberg said, "Raj made me lie to Rajat."

"No way!" Teglasi exclaimed, using the handle eglasinyc1.

"And rajat is waiting around," Eisenberg complained, as carynae82.

Rajaratnam also allegedly snubbed Gupta from an exclusive gambling getaway to Atlantic City's Borgata resort hotel, casino and spa.

Displaying an itinerary forwarded to her by email, Frankel led Eisenberg through the schedule, which started with a helicopter departure from New York. After they landed, limousines had been ordered to take the guests to the hotel, where they were scheduled to drink and dine at a private room of the hotel.

Notable guests included hedge fund billionaire Stan Druckenmiller, Tudor Investment titan Paul T. Jones, and Goldman Sachs executives Dave Heller and Gary Cohn.

"This was a once-a-year event," Eisenberg said.

As the trial took a break for lunch, defense attorneys aimed to leave jurors with the impression that Gupta's exclusion from the celebration distanced him from the alleged conspiracy.

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