| By Maureen O'Gara | Article Rating: |
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| February 13, 2010 02:45 AM EST | Reads: |
5,577 |
The Galleon hedge fund insider-information scandal resembles Agatha Christie's "Ten Little Indians." As of Monday, there was only one of the original characters left standing.
Of the six people arrested in October before the dragnet widened out, only IBM's former server chief Robert Moffat has yet to be charged. And there's a deadline that expires next week on what's gonna be done about the allegations he divulged IBM and Sun quarterly results and AMD's spin-out plans for its factories.
The two main culprits, Galleon CEO Raj Rajaratnam and New Castle Danielle Chiesi - into whose ear Moffat allegedly whispered company secrets - have pled not guilty to assorted criminal and civil charges; and three smaller fish have copped a plea in hopes of doing as little jail time as possible.
The latest was ex-Intel treasury director Rajiv Goel, who pled guilty Monday to giving Rajaratnam details of Intel's earnings in 2007 before they were posted - and specifics of a Clearwire joint venture that Intel planned to put a billion dollars in.
Goel, who said Rajaratnam paid him for the insider information, is looking at 20 years in the slammer for securities fraud and conspiracy to commit securities fraud. His cooperation is expected to lower the sentence.
He's the ninth person to plead guilty out of a total of 21 people facing charges and is due to be sentenced in late May.
Based on his admissions and those of former McKinsey & Company director Anil Kumar - as well as their willingness to testify to taking part in a conspiracy - the U.S. Attorney brought a new criminal indictment against Rajaratnam Tuesday adding two new charges of securities fraud as well as the claims that he traded on insider information from 2003-2009 and that he realized $45 million in illegal profits from the hanky-panky in a dozen stocks including IBM, Google, Sun, Intel, AMD, ATI, Clearwire, eBay, Akamai and Polycom.
He's now looking at 185 years in prison.
A federal court also decided that the SEC could use the government's massive wiretap evidence in its civil case against Rajaratnam and Chiesi and ordered it turned over. Rajaratnam's lawyer John Dowd is seeking to get the wiretaps excluded from both the civil and criminal trials on the grounds they were illegally obtained and is appealing the judge's SEC decision.
According to Bloomberg, Dowd also wants to sever Rajaratnam's trial from Chiesi's
Chiesi, who could be hit with 155-year sentence, recently gave an interview and claimed that neither she nor Rajaratnam would ever do a day of jail time.
Published February 13, 2010 Reads 5,577
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More Stories By Maureen O'Gara
Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara
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MADAME P J BAILEY 02/15/10 05:08:00 AM EST | |||
IBM Sr VP Robert ("Blabber Mouth") Moffat's pending indictment may become a bigger story than all the others combined ! Blabber Mouth was No. 2 man at IBM and expected to take over as IBM CEO. Details, links, and analysis of upcoming IBM Stockholder meeting here. |
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MADAME P J BAILEY 02/15/10 04:57:00 AM EST | |||
IBM Sr VP Robert ("Blabber Mouth") Moffat's pending indictment may become a bigger story than all the others combined ! Blabber Mouth was No. 2 man at IBM and expected to take over as IBM CEO. Details, links, and analysis of upcoming IBM Stockholder meeting here. |
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