Robert Moffat, the former I.B.M. executive who admitted to charges of insider trading in the Galleon hedge fund probe, wants people to know that his affair with co-defendant Danielle Chiesi was not about sex.
In an interview with Fortune, Mr. Moffat, who pleaded guilty on March 29 to securities fraud and conspiracy charges, said that his relationship with Ms. Chiesi was really more about business.
Mr. Moffat, once a candidate to succeed I.B.M.’s chief executive, Samuel Palmisano, is scheduled to be sentenced on September 13 in Manhattan federal court for his role in what U.S. prosecutors describe as the biggest probe of insider trading at hedge funds in the United States, Reuters said.
In somewhat purple prose, Fortune says Mr. Moffat “came across as emotional, repentant, and chastened” in the interview:
He wept describing the embarrassment he’d brought upon IBM, his colleagues, and family. While he showed little self-pity, he rebuffed the notion that he hadn’t paid a price for his crimes, noting that by leaving IBM he was giving up an estimated $65 million in lost stock options and pension that he would have collected when he retired at 60. “The biggest thing I’ve lost,” he said, “is my reputation.” Moffat was not allowed by his lawyer to discuss his case or his relationship with Chiesi, but when told that Fortune intended to write about the affair, he said this: “Everyone wants to make this about sex. Danielle had an extensive network of business people. And she added clarity about what was going on in the business world…I know in my heart what this relationship was about: clarity in the business environment.” He may even believe that.
Ms. Chiesi and Galleon hedge fund founder Raj Rajaratnam, 53, the principal defendants in the case, have pleaded not guilty to fraud and conspiracy charges. They are fighting to suppress wiretap evidence before their October trial.
Mr. Moffat’s involvement in the isnider trading scandal shocked his colleagues and left 31-year career at I.B.M. in ruins, Fortune says:
…of all the buttoned-down executives at Big Blue, Moffat was the last one that old friends could imagine being caught up in a scandal, let alone a crime. The former Eagle Scout had a reputation for loyalty as solid as his 6-foot-2, 265-pound frame.
Kenneth Hammer, a former IBM attorney who had worked with Moffat, recalled his reaction on hearing of the arrest: “There was no planet on which I could have understood what was being said about Bob. I just shut down.”
