Goldman Insider Trader Gets 3 Years In ‘Squash Buddies’ Case

(Bloomberg) -- Former Goldman Sachs Group Inc. investment banker Brijesh Goel was ordered to spend three years in prison for passing confidential deal information to a close friend and squash partner who traded on it.

Goel, 39, was sentenced Wednesday in Manhattan by US District Judge P. Kevin Castel. The former Goldman vice president was found guilty of insider trading and obstruction by a federal jury in June, following a roughly weeklong trial. Castel ordered Goel to surrender into custody on Jan. 9.

The prison term was slightly below that sought by prosecutors, who last week asked that Goel be given a sentence on the low end of the 41-to-51 month guideline for his offenses. Goel had asked Castel to give him no jail time, arguing that immediate deportation to his native India would be punishment enough.

In handing down the sentence, the judge criticized Goel harshly for lying on the stand during the trial and for diminishing the magnitude of his misconduct in his request for leniency. “You took the stand right in this chair and you lied again and again and again,” said Castel.

‘Deeply Ashamed'

Flanked by his lawyers and with his wife and friends behind him, Goel told the judge he regretted his misconduct. “I am deeply ashamed of my actions,” he said, fighting back tears. “I apologize to Goldman Sachs, to my colleagues, everyone who felt betrayed by my actions.”

Goel passed tips to Akshay Niranjan, a Barclays Plc trader who had been a classmate at the University of California, Berkeley's business school. The two made around $280,000 trading ahead of Goldman deals in 2017 and 2018.

The details of Goel and Niranjan's close relationship, including copious drug use, regular squash matches and music festivals, heightened the drama of Goel's trial, where Niranjan was the prosecution's star witness against his onetime friend. Niranjan recorded conversations in which Goel asked him to delete texts about his tips, which resulted in a conviction on obstruction as well as insider-trading charges.

“F***… This we need to delete,” Goel said in a conversation Niranjan recorded. “Did we put on any trade?... It has to be deleted. I don't even have this chat.”

Goel testified in his own defense at trial, claiming Niranjan set him up. On the stand, Goel denied ever leaking sensitive information to his friend. Instead he speculated that Niranjan probably accessed the material nonpublic information by peeping at his texts and emails or eavesdropping on his phone conversations with Goldman colleagues. According to Goel, Niranjan made up a story to deflect blame from himself.

‘Offensive' Lies

These were lies that were “offensive to anyone who loves this process,” the judge said at the sentencing. 

“These lies were so transparent it made it easy for the jurors to reach a verdict so quickly,” Castel said, nodding to the fact that the jury deliberated for only a few hours. “Everyone in the courtroom knew that he was lying and didn't believe this story.”

Goel will also have to pay a $75,000 fine and forfeit $85,000, which was his cut of the illicit profits. Goldman is also seeking $393,000 from Goel for legal expenses the bank incurred in the case. Castel has not yet ruled on Goldman's request.

Niranjan was not charged with any crime, but both he and Goel were let go from their jobs after the case was announced in July 2022. By then, Goel had left Goldman and become a principal at Apollo Global Management. 

Their insider trading took place while Goel was at Goldman though, with his first tip on bank's plans to provide financing to EQT AB's acquisition of Lumos Networks Corp. in 2017. The two men, who often played squash together, sometimes used the sport as a cover for their trading activity.

“Did you book the court?” Goel texted Niranjan after providing the Lumos tip. The scheme continued into 2018.

The case is US v. Goel, 22-cr-00396, US District Court, Southern District of New York (Manhattan)

(updates with remarks from Goel and judge as well as additional detail from court.)

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