Former Intel Executive Rajiv Goel Sentenced in Manhattan Federal Court for Insider Trading
|U.S. Attorney’s Office September 24, 2012|
Preet Bharara, the United States Attorney for the Southern District of New York, announced that Rajiv Goel, a former executive at Intel Corporation (Intel), was sentenced today to two years of probation for his participation in an insider trading scheme in which Goel provided material, non-public information (“inside information”) about Intel to Raj Rajaratnam, the head of Galleon Group (Galleon). Rajaratnam then traded based, in part, on the inside information. Goel pled guilty in February 2010 to one count of conspiracy to commit securities fraud and one count of securities fraud pursuant to a cooperation agreement with the government. He was sentenced in Manhattan federal court by U.S. District Judge Barbara S. Jones.
According to the information, statements made during Goel’s guilty plea proceeding, and Goel’s testimony during the criminal trial of Rajaratnam:
In April 2007, Goel provided inside information to Rajaratnam relating to Intel’s quarterly earnings before Intel publicly announced its very positive results. Upon receipt of the inside information from Goel, Rajaratnam executed, and caused others to execute, securities trades. When Intel disclosed its quarterly earnings, Rajaratnam sold his stock and illegally earned over $2.4 million. Subsequently, on multiple occasions in 2008, Goel provided Rajaratnam with inside information about Intel’s investment in Clearwire Corporation. Upon receipt of the inside information from Goel, Rajaratnam executed, and caused others to execute, securities trades. Based on Goel’s information, Rajaratnam illegally earned over $850,000.
In addition to his prison term, Goel, 54, was ordered to pay forfeiture in the amount of $266,649, a $10,000 fine, and a $200 special assessment fee.
Rajaratnam was convicted in a jury trial on May 11, 2011, of 14 counts of conspiracy and securities fraud. He was sentenced on October 13, 2011, to 11 years in prison and was ordered to pay forfeiture in the amount of $53,816,434 and a $10 million fine.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation. He also thanked the U.S. Securities and Exchange Commission.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a co-chair of the Securities and Commodities Fraud Working Group. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch and, with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
The case is being handled by the Office’s Securities and Commodities Task Force. Assistant U.S. Attorneys Reed Brodsky and Richard Tarlowe are in charge of the prosecution.