Disgraced IBM Exec Barred From Public Companies

A former IBM executive once pegged to be a possible successor to CEO Sam Palmisano has been barred from holding senior positions at publicly traded companies under an insider trading settlement with the Securities and Exchange Commission announced last week.

Robert "Bob" Moffat pled guilty last year to participating in one of the largest hedge fund scandals in the industry's history, and had already been sentenced to six months in prison on criminal charges.

Under a deal to avoid further penalties, Moffat agreed to a permanent ban on his becoming an officer or director at a publicly traded company. Judge Jed Raskoff entered the consent order and final judgment in Moffat's case Feb. 1 in U.S. District Court for Southern New York.

Moffat fed insider information about IBM and its partners to mistress and co-conspirator Danielle Chiesi, who in turn leaked the tips to the insider trading group's alleged ringleaders.

In the criminal case, Moffat was sentenced to six months in prison, two years of supervised released, and ordered to pay a fine of $50,000. Chiesi pled guilty to insider trading charges last month and is due to be sentenced in May.

A number of other tech industry players were caught up in a sting operation that cracked the case, including former Intel managing director Rajiv Goel, former Intel employee Roomy Khan, former Atheros Communications VP Ali Hariri, and former McKinsey consultant Anil Kumar.

Moffat held the post of senior vice president over IBM's $18 billion Systems and Technology unit, which manufactures semiconductors, high-end servers and related products. IBM ultimately replaced Moffat with longtime company veteran Rodney Adkins.