Silicon Valley Embroiled In Scandal (Again)

Execs from Intel, AMD, Google, McKinsey and Sun, as well as some hedgies, have had their collars fingered by the SEC. Six people have been charged with federal crimes.

The Globalfoundries deal is the subject of one of the charges. An AMD exec was allegedly keeping a portfolio manager at New Castle hedge fund abreast of developments so the hedgie could buy AMD shares ahead of the announcement.

The other part of the charges relate to information about the earnings guidance which companies give to stock analysts. This was funneled to hedgies before it became public knowledge allowing the hedgies to trade in the companies' shares ahead of the announcement.

Two of the six people facing criminal charges are from Intel and McKinsey, and three are hedgies

The US authorities call it the 'biggest-ever hedge-fund insider case' but since the accused are alleged to have made a profit of only $20 million, one would think that claim pretty unlikely.

OK it may be the biggest-ever hedgie insider dealing scam ever uncovered by the SEC, but since the SEC let Bernie Madoff operate for years, the SEC is obviously not very good at uncovering things.