The spiral spreads, galleon has another victim
Insider trading scandals hurt the best of employees and companies. This time its IBM.Robert Moffat, IBM’s head of supply chain was arrested few weeks ago in the wake of the massive Galleon scandal, bringing not only his career on the wire but also creating a vacuum in the supply chain, hardware, server & semiconductor business of IBM.
IBM officially lost one of its favoured employees on Friday in what can be termed as a straight result of his arrest.This can be seen as just a completion of the formal seperation obligations as he was placed on leave by IBM after his arrest on Oct 16th. Whether its a v oluntary defection or a forced one, nobody knows but his lawyer’s trying his best to not give this a “termination” tag.
More details of the government’s case continue to come out. Last week, for example, government prosecutors released information from an informant and wire taps that allege Moffat gave inside information about the quarterly earnings of Sun Microsystems to Rajaratnam through an intermediary that allowed the Galleon find to make a $900,000 profit on Sun’s stock. At the time, IBM was doing due diligence with Sun for a then-pending move to buy the company (a deal which later collapsed).