Intel Exec Allegedly Made $50K Through Insider Trading

Goel, charged along with Galleon Management founder Rajaratnam and McKinsey & Co. director Anil Kumar in a complaint filed Friday by federal authorities, has been placed on administrative leave from his position as a director of strategic investments in Intel's Treasury department, according to an Intel spokesman.

In addition to Goel's alleged dealings with Rajaratnam on the Clearwire matter, the complaint alleges that Rajaratnam conducted trades of PeopleSupport stock on Goel's behalf that ultimately netted Goel $50,000 in profit in October 2008. Rajaratnam's PeopleSupport transactions were conducted, according to the complaint, with inside information about the pending acquisition of PeopleSupport by India's Essar Group, supplied to Rajaratnam by a Galleon Management employee who was on the PeopleSupport board of directors.

The 51-year-old Goel, a resident of Los Altos, Calif., is also a director on the board of Calgary, Alberta-based SMART Technologies, a digital display vendor, a spokesperson for SMART Technologies told Channelweb.com.

Three other individuals have been charged in a separate criminal complaint in New York -- Danielle Chiesi, portfolio manager at $1 billion hedge-fund firm New Castle Partners; Robert Moffat, a senior vice president at Armonk, N.Y.-based IBM; and Mark Kurland, a senior managing director and general partner at New Castle, a former equity hedge-fund group of Bear Stearns Asset Management.

Goel's first contact with Rajaratnam outlined in the complaint came on March 19, 2008. Based on a federal wiretap on Rajaratnam's cell phone, the complaint alleges that on that day Goel shared confidential information with Rajaratnam about the progress of a large, multi-party investment in the wireless Internet service provider Clearwire that involved Intel, Sprint and other companies.

The next day, Goel and Rajaratnam allegedly hashed out the value of Clearwire following the potential investment from Intel, Sprint and others, with Goel allegedly supplying inside information about the size of Intel's investment -- $1 billion -- and the total amount of cash Clearwire would soon have on hand -- $4.7 billion.

Later on March 20, Goel allegedly made another call to Rajaratnam with the information that Intel's board "approved this deal" the previous day. According to the complaint, Rajaratnam asked Goel if the Clearwire deal would happen on "April 1st, right?" to which Goel replied, "Yeah, but you know these deals. Don't hold me to that date because these deals, they're so complex and so many parties involved, they will all have their say right now."

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