Former IBM exec Moffat gets six months in jail

By David Goldman, staff writer


NEW YORK (CNNMoney.com) -- Former IBM executive Robert Moffat was sentenced on Monday to six months in a federal prison for insider trading.

Moffat, once the senior vice president of IBM's (IBM, Fortune 500) systems and technology group and a potential successor to CEO Sam Palmisano, pleaded guilty in March to charges of leaking information to Danielle Chiesi, a Wall Street analyst for New Castle Funds LLC.

The former Big Blue executive -- also a member of Lenovo's board of directors -- admitted to sharing inside information with Chiesi about the companies, as well as chipmaker AMD (AMD, Fortune 500), from August through October 2008. Money wasn't Moffat's motive: He didn't make any stock trades based on his information.

But had had an affair with Chiesi, who is at the center of the largest hedge fund insider trading case in history. Among others charged were Raj Rajaratnam, founder of the Galleon Group hedge fund; a McKinsey & Co. director; a high-level Intel (INTC, Fortune 500) executive; and the head of New Castle Partners, a hedge fund that was once part of Bear Stearns.

So far, 12 of 21 people charged have pleaded guilty.

U.S. District Judge Deborah Batts, who sentenced Moffat, also fined him $50,000.

"Even high-flying executives do not receive get-out-of-jail-free cards for participation in insider trading," Manhattan U.S. Attorney Preet Bharara said in a written statement about the sentencing. "As a senior executive at IBM, Robert Moffat was entrusted with secret and valuable information. As today's sentence reflects, illegally betraying that trust is a serious crime." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 18,080.14 21.45 0.12%
Nasdaq 5,092.09 36.02 0.71%
S&P 500 2,117.69 4.76 0.23%
Treasuries 1.92 -0.03 -1.54%
Data as of 11:30am ET
Company Price Change % Change
Microsoft Corp 47.87 4.53 10.45%
Apple Inc 130.28 0.61 0.47%
Comcast Corp 59.64 0.41 0.69%
AT&T Inc 34.01 -0.22 -0.64%
Xerox Corp 11.99 -1.15 -8.75%
Data as of Apr 24
Sponsors

Sections

Shares in Italian bank Intesa Sanpaolo dropped sharply Friday after hoaxers claimed its CEO had quit after faking billions in profits. More

The impact of rising immigration on Britain's economy has become a hot topic in the election campaign. More

Apple is likely to post huge growth in sales and profits thanks to the popularity of the iPhone 6. Here's all the numbers to keep an eye on in the report. More

A Girl Scouts Cookie Oven rolling out to Wal-Mart, Target, Kmart stores this summer will let you bake those iconic thin mints right at home. More