WallStreetManna, a seasoned observer of the ongoing crime scene that is Wall Street, points out that pretending that Gupta was the only one at Goldman in a chummy relationship with Galleon is eye-wash. Galleon, like Madoff, was turning in returns too good to be true. Everyone had to have known.

Unlike Madoff, of course, Rajaratnam didn’t bilk his investors. They got all their money back, plus profits.

But the point still holds.

Galleon was just one of a number of  “under the table” relationships Goldman cultivated with hedge-funds and other favored operators, like…

…well, like the mysterious “self-made billionaire” Jeffrey Picower,  who died of a heart-attack just as the Madoff ponzi unraveled and just as he went from being a self-proclaimed victim to a suspected accomplice, if not master-mind, whose billions sat in an account managed by none other than Goldman Sachs.

“Now I compared Galleon’s returns to Madoff’s. What did the beneficiary of Madoff, to the tune of $7 billion, Jeffry Picower do, the minute he “found out” Madoff was a fraud?

He closed the Picower Foundation. Even though he could have easily kept it open. After all, didn’t he make $7 billion, that we found out later? He must have wanted it closed!

What did Raj do immediately after he was accused by prosecutors? Isn’t he closing the fund?

Why did Goldman think Madoff’s returns were inconceivable, but Galleon’s weren’t?

And why did Raj pay Goldman so much damn money?

Ask Raj. Or ask Anil.

But don’t ask Goldman. Or the SEC. They just hired a former Goldman cronie [sic] as their new COO before Raj got busted. [Lila: That would be Adam Storch]

You’ll just get “no comment.”
———

Now how about the Buffett tip?
————————–
Goldman directors even tipped the Buffett deal.

Anyone remember how Goldman reversed the steep sell-off the day before Buffett invested in Goldman? And how the financials reversed that day from their lows? Did anyone from Justice check out how Goldman traded in the SKF that day? How many shorts that they had laid out in that number?

And did Goldman, ramp and reverse the financials,  the day after the Government announced the shortseller rules, because they knew of Buffett’s investment?

After all, didn’t Byron Trott, Buffett’s broker at Goldman, who put the deal of Buffett’s investment into Goldman together–didn’t he at the end of March 2009, start his own firm?
And didn’t Goldman, change the rules on him alone, allowing Mr. Trott to sell his shares in Goldman, unlike the other executives who were handcuffed to the hip with their Goldman stock, because of Buffett’s investment?

The Sunday before Buffett’s announced investment, the Fed allowed Goldman to become a bank holding company. Then they blocked all short selling of the financials. Then Morgan Stanley announced their deal with the Japanese.

Buffett bought out Constellation Energy, to give confidence in the deal making arena, because that deal was on the ropes, and in the financials, names like State Street went from 30 to 64, Morgan Stanley, went from 12 to 34, and Goldman went from 86 to 144–all in ONE day–from 12:30 in the afternoon, to 8:00 am in the next day’s pre-market!

Is someone going to say that the stocks ramped all because you couldn’t lay out any more shorts, or those who were short, were instead tipped?

Here was the action in Goldman the day that Buffett’s tip to the rest of Wall Street was announced.

Why did you have, instead, the move in the financials, the days before?

How is it, that when a company on Wall Street, reports good numbers, and the stock sells off; that everyonne already knew that news.

Was the street so incestuous, that everyone else knew the news that Gupta had tipped?

How many people did Raj also tip? Who were also dying on the vine in September of 08?

And even with this massive, wonderful tip, Galleon was down 7.23% in September of 2008, and he was down another 5.23% in October. Even though he was getting tipped!

Is it any wonder why he was having crumpets and tea with Gupta, in his private office!

Away from the wires!

So now are we to believe, that it was just Raj, alone, who ramped the financials, or was a better explanation, that Goldman Sachs, decided to deploy their capital, into a massive short squeeze, in the shorted names, because they knew that the PPT, would be behind them, in their effort to prop up the markets, on the backs of the shortsellers, because Trott had already told Goldman that Buffett was in, and the Fed, had already told Goldman, that on Sunday night, they would be a bank holding company, and that, they would then have access to Ben’s billions?

And Ben, and Timmy, and Lloyd, will all suffer memory problems, because the sole rat, in this whole mess, was Raj, just like Goldman’s sole rat, in the Abacus, was a 27 year old kid called Fab!”

Forbes’ Walter Pavlo (May 23, 2012) noted that there were many other people at Goldman who socialized with Rajaratnam and could have been tipping him:

“Eisenberg testified that Gupta was on Raj’s list of names of “important” people that had immediate access to the Galleon co-founder and it was given to her by her predecessor.  Being on that list meant that Raj was to be told immediately and the list includes the names of Rajiv Goel, Anil Kumar and Danielle Chiesi …. all of whom have pled guilty to charges related to insider trading.  This strategy is meant to portray Gupta as being in some ring of co-conspirators when in fact this may not be the case.  Also on the list was Parag Saxena and Stanley Druckenmiller, neither are accused of any crime.  Druckenmiller was one of the top people of billionaire George Soros and headed his own hedge fund, Duquesne Capital Management (closed in 2010).  Saxena is a founding partner and CEO of New Silk Route Partners and, like Raj, graduated from the Wharton School (U Penn).

While Gupta was on Raj’s short list, I am certain he was also on other short lists.  I am confident that executive assistants at a number of firms were told to escalate a call from Rajat Gupta.  Lloyd Blankfein, CEO of Goldman might put someone like Gupta on his “short list” since Gupta was on the firms’ Board of Directors.  Billionaire Bill Gates may have Gupta on his list since he was on the board of the Bill & Melinda Gates Foundation.  But being on those lists do not help the government’s case.

Then there was that phone call Eisenberg testified about, the one from “Gupta’s phone number” that was placed to Rajaratnam moments before the close of trading on September 23, 2008, the day of the announcement of Berkshire Hathaway’s $5 billion investment into Goldman Sachs.   “Raj closed the door,” she testified, after she passed the call to Rajaratnam.  Then what?  Look, it doesn’t look good, but it is not supposed to look good …. but there are two different views of the same event.  There is no tape of that conversation, nor is there anyone that is going to testify about what they heard on that phone call…but there was testimony from a Galleon trader, Ananth Muniyappa, that said he was instructed to purchase 267,000 shares of Goldman stock after that phone call … a phone call which ended, according to Eisenberg, with a big smile from Raj.

Raj knew other people at Goldman Sachs beside Gupta, and this would also cast doubt as to who, if anyone, was providing inside information to Raj on Goldman. Goldman’s president, Gary Cohn, was known to socialize occasionally with Raj….so was David Loeb, head of of Goldman’s Asia equity sales…so was David Heller, co-head of Goldman’s security division … so was Michael Daffey, another Goldman executive.  Those guys have not been accused anything illegal, but oh the trouble that a well-timed call and a smile can get one into these days on Wall Street.”

Nathaniel Burney (Burney Law Firm) argues that the grey areas in the jurisprudence of insider trading leave the area wide open for due process violations when alleged crimes are being investigated and tried.

“On Feb. 3, an SEC press release about yet another expert network case said that “it’s legal to obtain expert advice and analysis through expert networking arrangement.”  So far so good.  But right before that, it said this case was part of “the SEC’s ongoing investigation into the activities of expert networks that purport to provide professional investment research to their clients.”  (Emphasis added.)  That’s a loaded sentence, and reveals a predisposition to think that expert networks are bad.  All this does is increase the fear that the feds are going to see insider trading where none occurred.

Similarly, in a Feb. 8 press conference for the latest roundup of insider trading charges, the SDNY U.S. Attorney Preet Bharara made a prepared statement that expert networks are not “inherently wrong or bad.”  It’s just that these particular defendants had a business practice that was inherently wrong.  But he opted not to discuss what is wrong or right about a situation where an expert network uses an employee of company X, even with company X’s permission.  He acknowledged that it’s still a “gray area.”

So Robert Khuzami spoke up.  Khuzami, the head of enforcement for the SEC, sent a warning that hedge funds dealing with expert networks had better do some serious due diligence, to find out whether the expert network uses employees of company X.  And if so, to make sure no material nonpublic information gets received.

In other words, there’s an affirmative burden to make sure the information you receive is not private.  Which is bizarre when there is no way to know that, in many cases, unless you’re privy to inside information. It’s a Catch-22.

-=-=-=-=-

So there’s a huge “gray area” as to whether expert networks are kosher or criminal, as they currently exist and have existed for the past decade or so.  In theory, they’re lawful, but in practice the government sees them as only “purportedly” lawful.  And if you happen to use them, and you get inside information — info you couldn’t have known was secret if you weren’t an insider — too bad, so sad.  You had a duty to know the unknowable.  Maybe.

There are far too many unknowables here.

Isn’t this a classic due process violation? For the government to be allowed to use its might to deprive individuals of their liberty, property and livelihood, the public had better damn well be on notice that the conduct is something that’s going to get punished. If the public could not have known that certain conduct was unlawful, the government cannot be allowed to punish it.

And if the government itself doesn’t know where to draw the line…?”

Make sure your name is Larry Fink, CEO of Blackrock.

“That BlackRock was awarded key contracts with no competitive bidding, in a process enveloped in secrecy, has also raised hackles in Congress and led to questions about Fink’s long-standing relationships with senior government officials, particularly former Treasury secretary Henry Paulson and Geithner, his successor.

“You see a lot of concentration now in the financial industry of people who are more connected than brilliant,” says Janet Tavakoli, the president of Tavakoli Structured Finance and the author of Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street. “So why BlackRock? Not to take anything away from Larry Fink, but all the contracts awarded to BlackRock, in the way they’ve been awarded, deserves some question.”

Idi Amin’s expulsion of Indians from Uganda is the uneasy memory that many diaspora Indians live with.

An immigrant always has something of the migrant worker in his make-up.

You feel you need to keep your bags packed at all times, and an eye on the window. You never knew what might happen or who might show up to ask for your papers.

There was Enoch Powell in Britain in the 1960s, with his talk of “rivers of blood.” But Idi Amin’s Uganda is the nightmare scenario.

An interview with Vishwa Samani, a London-based freelance journalist descended from Asians dispelled from Uganda.

“IB TIMES: Idi Amin seized power in Uganda in January 1971 — the order to expel Asians came nineteen months later. During that interim were there any indications that he wanted to remove the Indian community, or did it come as a complete shock and surprise?

SAMANI: Most of the expelled Ugandan Asians I have interviewed who now live in the UK say the order came as a complete shock and there was no real indication it was going to happen. When Idi Amin came into power, he made the working conditions for business favorable. Many Indians — especially non-citizens that engaged in business, commerce and trade actually viewed Amin’s assumption of power with some relief. There had been fear surrounding measures introduced by his predecessor Milton Obote over entry permits and economic reforms that sought to redress the balance between Africans and non-Africans. But after 1971 Idi Amin had started offering residence permits, granting import licenses to businesses and generally opening up the market for importation, Asian businesspeople started to repatriate capital and investments back to Uganda. Early measures introduced by Amin were not exclusively beneficial to Asians, but as Asians operated the majority of business and trade, they benefited from them the most. Most expelled Asians felt settled in Uganda, indeed many of their parents were born in Uganda (2nd generation), and it was regarded as their home country……..

IB TIMES: Did the majority of African Ugandans support Amin’s decision to deport Asians?

SAMANI: African Ugandans themselves were strongly associated with their respective tribes, so it is difficult to lump them all together in one category of opinion. The general impression I have, from speaking to African Ugandans is that many were not in favor of the expulsion, especially those who were employed by Asians. The expulsion put many African Ugandans out of work. Some saw Asians as job-providers and essential to the proper functioning of the economy. There were others who welcomed the expulsion. This was mainly expressed by politicians who were aligned with Amin’s way of thinking.

IB TIMES: Did the order to expel “Asians” include other ethnic groups like Chinese or Arabs?

SAMANI: I have not come across any record of Chinese settlers in Uganda at this time. Arabs made up a very small proportion of the population; a fraction of the number of Indians. The order was directed at the large Indian community, particularly those in business and trade, the vast majority of whom had British passports.

IB TIMES: Were most Indians in Uganda at the time Gujaratis? Were there Sikhs and Muslims among them? If so, did Amin (a Muslim himself) spare Indian Muslims from the deportation order?

SAMANI: A large proportion of Indians, approximately 80 percent, were of Gujarati origin, including both Hindus and Muslims. There were a few other Indians from different states in India, including the Punjab. The official argument for expulsion seemed to hinge on national identity and economics rather than religious difference. Consequently, Muslim Indians were treated the same as Hindu Indians.

IB TIMES: Prior to expulsion, what was the legal status of Asians in Uganda? Were they citizens of Uganda?

SAMANI: In the lead up to Uganda’s independence, the colonial government offered British nationality to people of Indian origin. A majority chose to become British nationals, which seemed the obvious and more secure choice. A small number opted for Ugandan citizenship at this time. They were a negligible minority; at a guess, around 1,000 Indian families chose Ugandan passports. Choosing Ugandan citizenship enabled you to trade in any part of the country, without the same restrictions that were applied to those who carried British passports.

IB TIMES: Asians were expelled from neighboring Kenya in 1968 – did that set a precedent from Amin in 1972?

SAMANI: You would expect that it would have played a part but I am not aware of Amin referring to the Kenyan expulsion at any point. The Kenyan Indians were expelled in a much more civilized way; it was not at gunpoint. They were allowed to keep their possessions and leave with their money.

IB TIMES: Of the 90,000 or so Asians who left Uganda, did most of them go to Britain? If so, did they already carry UK passports and have the legal right to settle in Britain?

SAMANI: Around 30,000 Indians came to the UK, a small proportion went to India, and many of the Ismailis (an Indian Muslim community) went to Canada. Those who settled in the UK did have British passports, and did have the legal right to settle in Britain. However, most of them had never lived in the UK before.

IB TIMES: Did some Asians remain in Uganda in defiance of the expulsion order? If so, what did they do in the country?

SAMANI: A small number of Asians remained in Uganda. But that was not in defiance, some were allowed to stay because of their vocation, and a few had become Ugandan nationals at the time of independence. The general impression I have is that anyone who could escape, did escape. The army had turned on the Asian community, and everyone was afraid. Amirali Karmali, is a Ugandan Asian entrepreneur who stayed in the country, and rebuilt his business in the early 1980s; today, the Mukwano Group of Companies, is one of the biggest conglomerates in Uganda.

IB TIMES: Did Ugandan authorities strip the Asians of all their wealth and assets prior to their forced departure from the country.

SAMANI: Yes – all assets were confiscated, there were army checkpoints on all major roads, any gold, jewelry or money Asians were carrying with them was taken. Asians were also unable to access their bank accounts, so they landed in Britain without a penny to their name. A few of the wealthier Ugandan Asian families probably held foreign bank accounts, but the vast majority would have arrived in the UK with nothing.

IB TIMES: Amin claimed that Indians in Uganda were dominating and exploiting the economy at the expense of local Africans. Is there any validity to this assertion?

SAMANI: Indians did not really have any power to marginalize African Ugandans. They were operating under rules set by a colonial government. The economic segregation primarily arose due to ‘know how’ and trading instinct of the Indians. Even when trading regulations did not favor the Indians, they still prospered. It was mainly politicians of Amin’s persuasion that claimed the Indian community exploited Ugandans.

IB TIMES: Indians had lived in Uganda for about a century prior to the expulsion. How did they get along with African people? Did Indians remain isolated, or did they socialize with the African people?

SAMANI: Indians generally employed African Ugandans, and from what I understand, they did not really socialize. You could say the Indians were isolated, but every community in Uganda socialized and mixed only amongst its own people – the Indians were not unique in behaving in this way. This also applied to Ugandan tribes and Europeans.

IB TIMES: Were any Indians killed by Amin’s soldiers?

SAMANI: I have no recorded data of this, only anecdotal evidence that perhaps a hundred or so Indians were unaccounted for. There were not really any widely reported cases of murder. Most arrived in the UK having left in hostile circumstances, and there are some cases of individuals who disappeared and remain unaccounted for.

IB TIMES: After the Indians left, did Uganda’s economy collapse?

SAMANI: From 1971 to the National Resistance Movement (NRM) Party’s adoption of free market reforms in 1987, the Ugandan economy fell deep into a crisis under the strain of civil wars, the nationalization of certain industries and the expulsion of the Asians. The NRM overthrew Amin in 1979. The instability of the economy between 1971 and 1987 led to the rise of the informal sector. By 1987, President Yoweri Museveni had inherited an economy that suffered the poorest growth rate in Africa.“

Derrick Ashong at Huffington Post has the best comment about the whole Wikileaks model:

“You blow the whistle to spread the truth, not to hear the sound.”