Robert Moffat, the former high-ranking IBM executive charged in a wide-ranging insider trading scheme, appears ready to plead guilty, possibly as soon as March 30.
According to reports and court documents, Moffat, who at one time was seen as a possible successor to current IBM CEO Sam Palmisano, has waived his right to an indictment, a move the usually precedes a guilty plea.
He reportedly is due in U.S. District Court in New York City March 30 for a hearing on the indictment waiver.
Moffat faces a host of charges that include securities fraud and insider trading. He was one of almost two dozen people arrested in the case, which was characterized by federal government’s use of wiretaps that are commonly seen in organized crime cases.
Federal prosecutors say the insider trading scheme netted more than $25 million in illegal gains.
In Moffat’s case, he allegedly was caught on tape in 2008 talking with Danielle Chiesi, at the time a portfolio manager with hedge fund New Castle Funds and a personal friend, about chip maker’s Advanced Micro Devices’ plans to spin off its manufacturing business. AMD eventually did spin off the business, creating Globalfoundries.
According to court documents, Moffat also allegedly talked with Chiesi about IBM’s interest in buying Sun Microsystems and about IBM’s finances.
At the time, Moffat was senior vice president and group executive of the company’s $20 billion Systems and Technology Group. He was arrested in October, along with Chiesi and a number of other people connected with Wall Street and the technology industry.
Others charged include Rajiv Goel, an executive with Intel’s treasury group; Anil Kumar, a director at McKinsey & Co.; Raj Rajaratnam, founder and managing partner of hedge fund Galleon Management; and Mark Kurland, a senior managing director and general partner at New Castle. New Castle Funds and Galleon Management also were named in the complaint in October.
Almost a dozen people have pleaded guilty in connection with the case, including Goel and Kurland. Goel no longer is an Intel employee, according to the company.
Though not charged, former AMD CEO Hector Ruiz also has been tainted by the case. In the wiretaps, Chiesi is said to be talking about an unnamed AMD executive who also was giving her information. Several publications, citing unnamed sources, said Ruiz was that executive.
Soon after the reports came out, Ruiz resigned as chairman of Globalfoundries.