Ex-Intel executive sentenced in NY for fraud

Topics: From the Wires,

NEW YORK (AP) — A former Intel Corp. executive’s testimony at trial against a billionaire hedge fund founder accused of insider trading earned him leniency on Monday at sentencing for feeding confidential information about the computer chipmaker to the hedge fund founder, a former schoolmate.

Rajiv Goel, 54, apologized and said he was “deeply ashamed” before he was sentenced by U.S. District Judge Barbara Jones to two years of probation. The judge also fined the Los Altos, Calif., resident $10,000 and ordered him to forfeit $266,000.

Goel, who had faced up to 25 years in prison, said, “I had a serious lapse of judgment and good sense.”

Goel was a director of strategic investments at Intel’s investment arm, Intel Capital, until he left in 2009. He admitted supplying secret details about Intel’s investments to Raj Rajaratnam, who is serving an 11-year prison sentence after he was convicted of securities fraud charges for making inside trades that the government claimed earned him $75 million illegally.

Goel’s defense attorney, David Zornow, said his client met Rajaratnam at the University of Pennsylvania’s Wharton School of Business in the early 1980s and rekindled a friendship after the Sept. 11, 2001, terrorist attacks. He called Rajaratnam a “master manipulator” and a “corrupter of friends” who was larger than life to Goel, who came to the United States from India in the early 1980s to go to school.

Zornow said his client had “a unique relationship with a guy who frankly played Mr. Goel like a fiddle.”

Goel admitted at Rajaratnam’s trial that he gave Rajaratnam, who’s from Sri Lanka, inside tips about Intel’s investments and returns in 2007 and 2008.

Assistant U.S. Attorney Reed Brodsky said Goel did everything he could after his arrest to make up for his crimes, including continuing to cooperate even after Rajaratnam’s trial. He called Goel’s testimony “very powerful.”

The judge, before she announced the sentence, said Goel “showed good sense in deciding to cooperate.” She noted that two other people who cooperated also had received probation.

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