Friday, October 30, 2009

The Latest Scoop on the Galleon Insider Trading Scandal

Judging from the response to last week’s post, it seems that most of you – the readers of this blog – are as interested in the Galleon insider trading scandal as I am. I will continue to watch and report the latest developments on this blog, so you don’t have to. And this week – lucky you – you get a double feature!

Here are the highlights of the insider trading scandal to date:

Friday October 16th – Raj Rajaratnam (Galleon Group), Anil Kumar (McKinsey), Rajiv Goel (Intel), Danielle Chiesi (New Castle Partners), Robert Moffat (IBM), and Mark Kurland (New Castle Partners) were arrested in what is being called the largest insider trading scheme involving a hedge fund. The FBI press release, the New York Times, CNN and other news sources detailed the alleged charges which include securities fraud and conspiracy involving illegal trades of Akamei, Hilton Hotels, Google, Sun, AMD, and others.

Sunday October 18th – Rajaratnam was released on $100 million bail according to US News Today.

Monday October 19th – USA Today reported that more arrests might be coming. Moffat was released on $2 million bail according to the Poughkeepsie Journal. IBM announced that Bob Moffat has been placed on leave, and that Rod Adkins will be acting as senior vice president of systems and technology. (A terrific choice in my opinion.)

Wednesday October 21st – Galleon Group announced to investors and employees that it will wind down operations. This Reuters article outlines the success the Galleon funds have had. The New York Times reported that Roomy Khan (a former Galleon employee) is the informant (aka cooperating witness) in the case.

Thursday October 22nd – eWeek reported that the Alliance@IBM is asking the SEC to investigate all IBM executives. (Does anyone else think that’s overkill?)

Friday October 23rd – The New York Times reported that senior Polycom executive, Sunil K. Bhalla, was placed on leave.

Wednesday October 28th – Bloomberg reported that Hector Ruiz, former CEO of AMD, is the unnamed AMD executive who allegedly disclosed information to Chiesi.

Check back periodically for updates on the insider trading scandal and don’t forget to check out this week’s regular post also!


Anonymous said...

The Poughkeepsie SunJournal had a link to the affidavit (27 pages I think). The entries about the calls from Moffatt were interesting. No details given, but a summary of the calls.

Anonymous said...

Amen, and no I do NOT think it is overkill to investigate all executives.
If you find (1) rotten apple in your basket, do you not at least check the rest?

I also find it insulting that IBM HR has not come forward to answer questions, or provide a status of this situation which hits IBM very hard in its "corporate values".

Anonymous said...

Has anyone taken a look at the trading patterns of these bad guys and other execs? Is there anything interesting to see?