Robert Moffat, a former IBM executive (shown leaving federal court in New York), faces up to six months in prison.
(Peter Foley/ Bloomberg News)
NEW YORK — Robert Moffat, former senior vice president at International Business Machines Corp., admitted he leaked inside information to Danielle Chiesi, a consultant for New Castle Funds LLC.
“I knew the information I provided would be helpful to her,’’ Moffat told US Magistrate Judge Frank Maas yesterday.
Moffat is the 11th person to plead guilty in two overlapping insider-trading cases related to Galleon Group LLC and New Castle Funds. He is among 21 who have been charged.
Moffat, who pleaded guilty to conspiracy and securities fraud, faces no more than six months in prison.
Raj Rajaratnam, Galleon’s founder, and Chiesi allegedly used confidential tips to earn millions of dollars in illegal stock trades. They both deny wrongdoing.
Moffat admitted he leaked information about IBM, Lenovo Group Ltd., and Advanced Micro Devices Inc. from August to October 2008. He told Chiesi about disappointing sales of IBM servers, a pending restructuring at AMD, and earnings at Lenovo.
Moffat learned the information as a nonvoting member of Lenovo’s board and because he knew IBM had been asked by AMD to use a license as part of its restructuring.
On Jan. 27, New Castle’s cofounder, Mark Kurland, pleaded guilty to insider trading. Kurland faces 30 to 37 months in prison. Prosecutors said he and Chiesi used secret tips when they traded in AMD, Akamai Technologies Inc., and Sun Microsystems Inc. while at New Castle from August 2008 to January 2009.
With Moffat’s plea, four of the six people arrested on Oct. 16, when the Galleon case became public, have admitted guilt.
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