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Intel Says CEO Dumping Tons of Stock Last Year 'Unrelated' To Big Security Exploit (gizmodo.com)
An anonymous reader shares a report: Late last year, the CEO of Intel sold millions of dollars in company stock, as CEOs often do. The sale appears to have occurred while developers were reportedly rushing to fix a major security flaw affecting Intel processors made in the last decade. According to a report published by the Register this week, "a fundamental design flaw in Intel's processor chips has forced a significant redesign of the Linux and Windows kernels to defang the chip-level security bug." Windows and Linux developers have reportedly been working to address the issue since November. As our friends at Gizmodo ES pointed out, Intel's CEO Brian Krzanich sold roughly $11 million in company stock at the end of November. Counting the employee stock options Krzanich exercised, the CEO unloaded 245,743 shares, leaving him with 250,000 remaining shares -- the minimum Krzanich is required to own according to the company's bylaws, the Motley Fool reported. To be clear, this isn't proof of some insider-trading conspiracy. Contacted by Gizmodo, an Intel spokesperson called the sale "unrelated," and said it "was made pursuant to a pre-arranged stock sale plan (10b5-1) with an automated sale schedule."
"...sensors are indicating bullshit levels completely off the scale..."
And maybe all he had to do was not to cancel a pending sale.
Ezekiel 23:20
I'm no BK fan, as I used to work for the company, but I think this is just bad timing. I would have sold about the same time also. The stock is the highest it's been since the .com bubble burst. Intel stock has been an ok dividend stock for many years now, but relatively flat.
Just donate to the right candidates and you will never have any legal problems.
Place something witty here
You can do better, setup a sale every 3 months just in case. If "in case" does not happen cancel transaction and wait for next window. If "in case" happens you are covered.
The sale was more than likely schedule well in advance of that date - which would be before the defect was reported. As such he is not trading on insider information since he was not relying on any insider information. It doesn't necessary look good, and if he were interested in the optics of it -- he could have cancelled it... but it was not a requirement. The majority of his assets are likely Intel stock by the fact he gets paid in it - and financially it makes sense to diversify - especially with the renewed competition with AMD.
So lucky, bad optics, but nothing illegal.
Also, The stock price is actually at or above the price that it was in November...
It doesn't hold a candle to your shoot-from-the-hip incendiary comment plan. I and others have written repeatedly in detail about why the timing and amount of Equifax's execs' transactions were completely consistent with their past trading patterns and weren't at all consistent with a dump. Did you have some specific facts you wanted to share with the class that support your belief that those transactions were indeed uncharacteristic?
The class war is in full effect. Time you picked a side.
CEOs and their obscene salary and bonus schedules are put in place by board members.
Ah, yes. The board members who themselves are CEOs for other companies and who get paid salaries and get benefits that are comparable to other CEOs. The whole thing is more incestuous than a medieval French court.
The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
To avoid the appearance of impropriety, executives often are required to schedule stock sales months ahead of time. That's what happened here.
Yes, but how many months ahead of time in this particular case? From some of the released information so far, we know that Google contacted Intel about their discovery of this issue on June 1, 2017.
According to the link below (warning...anti-adblock popup), the sales were arranged in October, LONG after Intel was aware of it. Between June and October, it's almost certain information about the magnitude of this vulnerability and the impact of fixing it had made it all the way up to to the CEO.
http://www.businessinsider.com...
It's not a crime because it's not a crime. If he would have waited until after the story broke he would have made more money of the sale of his stock, because the price is still higher than it was on Nov 29th. You need to personally gain to be accused of insider trading.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
You need to personally gain to be accused of insider trading.
That isn't entirely correct. One can do insider trading to prevent a loss as well as get a gain. The definition from the SEC:
Illegal insider trading refers generally to buying or selling a security, in breach of a fiduciary duty or other relationship of trust and confidence, while in possession of material, nonpublic information about the security. Insider trading violations may also include "tipping" such information, securities trading by the person "tipped," and securities trading by those who misappropriate such information.
The next paragraph relates to the current issue:
Examples of insider trading cases that have been brought by the SEC are cases against:
Corporate officers, directors, and employees who traded the corporation's securities after learning of significant, confidential corporate developments;
Friends, business associates, family members, and other "tippees" of such officers, directors, and employees, who traded the securities after receiving such information;
Employees of law, banking, brokerage and printing firms who were given such information to provide services to the corporation whose securities they traded;
Government employees who learned of such information because of their employment by the government; and
Other persons who misappropriated, and took advantage of, confidential information from their employers
The link from the SEC
We will bankrupt ourselves in the vain search for absolute security. -- Dwight D. Eisenhower
I don't know. That chart you linked was pretty telling. He used to hold 300k shares. Then his typical average went to 350k shares, drifted up to 400k, then drifted up to 500k shares. There was some fluctuation, but over time he was generally increasing his holdings pretty reliable. Then bam!!! End of November comes and he sold every last share that he was allowed to sell (Intel rules say the CEO musk own 250k shares, and he sold down to exactly 250k).
One odd thing about that chart. The numbers on that chart dont exactly add up between consecutive transactions (previous total +/- shares traded should equal new total), but they are at least reasonable close. But then the 2nd to last line we see he has a balance of around 500k shares (which is consistent with the trend), but that the last line where he ends up with exactly 250k shares left, but it says he traded almost 900k shares to get to that point. Not sure what that discrepancy is about.