Seeking to prove that ex-Goldman Sachs director Rajat Gupta benefited from his relationship with Raj Rajaratnam, prosecutors have claimed that the Indian-American was secretly serving as a top executive of the the convicted hedge fund founder's Galleon group.

Testifying for the government on the eighth day of 63-year-old Gupta's insider trading trial on Thursday, former marketing executive at Sri Lankan native Rajaratnam's Galleon hedge fund Ayad Alhadi disclosed that Gupta had been secretly serving as a Galleon executive.

Alhadi told jurors about a March 28, 2008 meeting in Rajaratnam's office, where the Galleon co-founder said Gupta "would be the new chairman of Galleon International" and responsible for investments outside the US.

Gupta was present at the meeting.

"I think I congratulated him," Alhadi said adding that Gupta may not have been officially named Galleon International chairman.

According to prosecutors, Rajaratnam had also awarded Gupta an ownership stake in Galleon but during cross examination by defence lawyer Robin Wilcox, Alhadi said he "never received notice that it was consummated."

Alhadi said he had joined Gupta on a two-day marketing trip beginning March 31, 2008 to the United Arab Emirates where Gupta "was going to be helping Galleon meet prospective investors" like the Abu Dhabi Investment Authority and the Emirates Bank.

"I introduced him the way he was introduced to me, the new chairman of Galleon International," Alhadi said.

Prosecutors offered the evidence to highlight the business relationship between Gupta and Rajaratnam to counter the defence's claims that there was a falling out between the two men.

The government is seeking to prove that since Gupta and Rajartanam had business dealing together, Gupta had a motive to pass insider information to the Sri Lankan native, who is currently serving an 11-year prison term after being convicted of insider trading charges.

Alhadi testified that after the trip, one of the sovereign wealth funds he and Gupta met with on their Middle East trip agreed to invest USD 25 million in a Galleon fund and promised another USD 50 million investment four days after meeting them again at Galleon's office in New York.

US prosecutor Reed Brodsky asked Alhadi whether Gupta said anything about Rajaratnam in the meetings, to which he replied, "Yes ... it was a positive opinion of his investment capabilities."

Alhadi had told government investigators in a pretrial interview that for some investors, meeting Gupta was akin to having met a "rockstar."

In an e-mail to a banker that was going to help Galleon set up meetings, Alhadi praised Gupta's credentials.

"I will be in the Emirates with Rajat Gupta, a friend and adviser to Galleon," Alhadi wrote, "he's a highly respected global business leader and I know a meeting with him would be very worthwhile."

In another e-mail, Ahladi told Gupta about the reaction of an executive at the National Bank of Abu Dhabi when he heard about Gupta's Galleon connection.

"When I told him about your affiliation with Galleon he was extremely impressed," Alhadi wrote. "He said it would be an 'honor to meet you.'"

Gupta has pleaded not guilty to charges of providing Rajaratnam with insider tips while he was a director at Goldman Sachs and Procter & Gamble.

Brodsky told judge Jed Rakoff that Goldman Sachs Chief Executive Officer Lloyd Blankfein would testify at the trial next week.

Blankfein had testified at Rajaratnam's trial in March last year and had told jurors that Gupta violated his duties of confidentiality by discussing contents of the June 2008 Goldman board meeting with Rajaratnam.

"We don't want information about our company to get outside before the time is appropriate," Blankfein had testified in March last year.

After the prosecution wraps up its case by June 6, defence will present its witnesses, including members of Gupta's family and his personal assistant.

Defence lawyer Gary Naftalis said he also planned on reading a deposition testimony from Berkshire Hathaway's reinsurance chief Ajfit Jain, a close friend of Gupta's.