Otellini: Intel ‘knew nothing’ about insider trading probe
Intel CEO Paul Otellini says the company knew nothing about the insider trading investigation into Galleon Group, which implicated an Intel executive, until the Feds turned up.
In an insider trading scam orchestrated by the Galleon Group hedge fund, IBM’s Robert Moffat - widely tipped to become CEO - Rajiv Goel, head of Intel’s venture capital division, and Anil Kumar, an advisor to AMD, were among senior directors arrested late last week.
The men are accused of using inside knowledge to help investors make an illegal $25 million profit on deals made between 2006 and 2009 involving companies such as AMD, Google and Sun in return for monetary reward. Wire taps were put on the suspects after an anonymous tip-off.
"No one in our legal department or management knows anything about this," Otellini told the Wall Street Journal.
The probe into Galleon could be the biggest insider-trading case in years, as Raj Rajaratnam, Galleon's co-founder, along with the other arrested men, stand accused of trading on their insider knowledge involving companies like Intel, IBM and Google.
Rajaratnam is said to have receieved information on upcoming Intel earnings releases and details of planned Intel deals with companies such as wireless outfit Clearwire from Goel.
Otellini was at pains to stress that insider-trading problems were ‘extremely rare’ during his time at Intel and that the company has procedures in place to prevent them. He added that there had so far been no dealings between Intel and the authorities in the investigation on either an official or unofficial level.