Former Intel exec pleads guilty to insider trading


Former Intel exec pleads guilty to insider trading

Warwick Ashford

A former Intel executive has pleaded guilty to passing on sensitive information about his company to Galleon Group hedge fund manager Raj Rajaratnam.

Rajiv Goel, who was the director of strategic investments at the chipmaker's investment division, also admitted profiting from Galleon's trading on his tips, according to the Financial Times.

According to court papers filed by the US attorney in Manhattan, Goel passed along inside information to Galleon from 2007 to 2009.

Goel admitted in court that he passed along Intel earnings-related information to Rajaratnam days before the chip maker announced its quarterly earnings in April 2007.

Acting on the information, Rajaratnam cancelled a $23.5m short position on Intel and purchased $36m of Intel shares in the days leading up to Intel's earnings announcement.

Goel, who left Intel in late 2009, is the ninth defendant to plead guilty in the Galleon hedge fund investigation.

In November, two top tech company executives stepped down after being implicated in the insider-trading scandal involving at least six technology companies.

Hector Ruiz, chairman of AMD spin-off Globalfoundaries and Robert Moffat, senior vice-president of IBM's $19bn systems and technology group, left their posts after being charged in the insider trading case related to Galleon.

Rajaratnam, Galleon's founder, has denied any wrongdoing and is currently free on $100m bail.

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