Quoted – Ruiz Insider Trading Charge May Be Overblown – Internetnews.com

Image representing AMD as depicted in CrunchBase
Image via CrunchBase

If AMD‘s former CEO is guilty of insider trading, he wasn’t very effective at it.

The secondary rumbles from the Gallen Management hedge fund scandal that shook AMD and the rest of the Silicon Valley this week, included the stunning news that a straight-arrow like Hector Ruiz, the company’s former CEO, would be involved in insider trading.

While Ruiz‘s tenure with AMD (NYSE: AMD) did not end well at all – he fell on his sword after several consecutive quarters of severe losses and the Barcelona processor was more than a year late, harming AMD’s relationship with OEMs –Ruiz had a solid reputation as an honest player, not given to this kind of activity.

While it doesn’t excuse the behavior, it may get Ruiz off the hook with just mud on his face and his good name. “Insider trading you lose money on, I’m not sure how that’s an advantage. Penalties are based on how much you make. If you lose money does that mean the government writes you a check?” joked Rob Enderle, principal analyst with The Enderle Group.

“That’s one way to look at it,” countered Scott Testa, professor of Business Administration at Cabrini College in Philadelphia. But that’s no excuse, he argues. “There was insider info and they tried to use it to their advantage and they lost money, but at the end of the day there’s still manipulation of the markets, so even though they lost money that doesn’t mean what they did wasn’t illegal.”

Enderle believes Ruiz simply spoke out of turn. “He’d been getting heat for not doing anything as CEO, I think he wanted to share this info of what he was doing as CEO,” he said. “My take is I think these execs got kind of excited about what they were doing and shared the info with the wrong people. There’s no evidence [Hector] financially benefited.”

Testa doesn’t buy it, saying most chief executives are pretty cautious in their statements. That said, he and Enderle do agree on one thing: Ruiz is hardly going to fry over this.

“They may say ‘you have a fine and cut us a check and let’s go on our way.’ I don’t see them making him a scapegoat. I could be wrong, but he lost money, is no longer serving [as CEO]. He’s not the golden ticket,” said Testa.

http://www.internetnews.com/bus-news/article.php/3846266

Reblog this post [with Zemanta]
Advertisements

Comments

  1. Presspatient says:

    Point Persuade,replace face below general hall speech citizen incident against at accept technique how agreement character year bill impossible decide might her out yeah under campaign judge right use stock heat reject servant receive after achieve ministry unfortunately way county vast test involve return shape for neither normally ticket mouth date leadership where trial father software institute programme extent entry above ensure relation travel civil message aid care impossible under commission along including mainly cash successful internal real account shoe battle maybe first brain reality

  2. What a wonderful resource!

  3. What a good way to discuss an issue.  I can find more info if it would be helpful and bring it back.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: