Former IBM executive pleads guilty to insider trading in Galleon probe

[JURIST] Former International Business Machines Corp. (IBM) [corporate website] senior vice president Robert Moffat pleaded guilty [press release, PDF] Monday to conspiracy and securities fraud charges stemming from his involvement in the largest hedge fund insider trading case in US history. US Attorney Preet Bharara [TIME profile] said, "[Moffat] willfully ignored his professional and legal responsibilities," and provided inside information in breach of fiduciary duties, facilitating illicit securities transactions. Moffat's plea is in connection with the probe surrounding Galleon Group [partnership website] hedge fund founder Raj Rajaratnam [FT profile; JURIST news archive] and former hedge fund consultant Danielle Chiesi. Moffat's conviction is the eleventh among 21 people currently under investigation [JURIST report] by the Department of Justice [official website].

Last month, a federal judge decided Rajaratnam's criminal trial [JURIST report] will begin October 25. Former Intel Capital [corporate website] executive Rajiv Goel pleaded guilty [JURIST report] to insider trading charges in connection with the Galleon probe earlier in February. Rajaratnam, Chiesi, Goel, and Moffat were arrested in October and charged [complaint, PDF] along with two other individuals and two business entities with insider trading. The complaint alleged that the individuals provided Galleon Group and another hedge fund with material nonpublic information about several corporations upon which the funds traded, generating $25 million in illicit gain. Rajaratnam and Chiesi pleaded not guilty [JURIST report] in December after being indicted for insider trading.



 

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