Former Flextronics Director Walter Shimoon has pled guilty to two counts of conspiracy to commit securities fraud and wire fraud and one count of securities fraud for leaking details about the iPhone 4 and iPad.
Flextronics supplied Apple with camera and battery components and Shimoon used his position there to earn $200 per hour by leaking insider information to a group of "hedge funds and expert networks".
Fortune notes that while being wire tapped by the FBI, Shimoon gave his contact early sales figures and dropped two bombshells:
● The iPhone 4: Apple, he told his contact, was "coming out next year" with a new iPhone that's "gonna have two cameras ... It'll be a neat phone because it's gonna have a five-megapixel auto-focus camera and it will have a VGA forward-facing videoconferencing camera." Apple announced the iPhone 4 -- with its two cameras -- eight months later.
● The iPad: "They [Apple] have a code name for something new ... It's ... It's totally ... It's a new category altogether... It doesn't have a camera, what I figured out. So I speculated that it's probably a reader. ... Something like that. Um, let me tell you, it's a very secretive program ... It's called K, K48. That's the internal name. So, you can get, at Apple you can get fired for saying K48." The iPad -- code named K48 -- was unveiled four months later.
Kingdom Ridge used this information to make $560,000 in profits in October 2009.
Shimoon pled guilty and sentencing is scheduled for July 8, 2013. He could spend up to 30 years in prison.
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Flextronics supplied Apple with camera and battery components and Shimoon used his position there to earn $200 per hour by leaking insider information to a group of "hedge funds and expert networks".
Fortune notes that while being wire tapped by the FBI, Shimoon gave his contact early sales figures and dropped two bombshells:
● The iPhone 4: Apple, he told his contact, was "coming out next year" with a new iPhone that's "gonna have two cameras ... It'll be a neat phone because it's gonna have a five-megapixel auto-focus camera and it will have a VGA forward-facing videoconferencing camera." Apple announced the iPhone 4 -- with its two cameras -- eight months later.
● The iPad: "They [Apple] have a code name for something new ... It's ... It's totally ... It's a new category altogether... It doesn't have a camera, what I figured out. So I speculated that it's probably a reader. ... Something like that. Um, let me tell you, it's a very secretive program ... It's called K, K48. That's the internal name. So, you can get, at Apple you can get fired for saying K48." The iPad -- code named K48 -- was unveiled four months later.
Kingdom Ridge used this information to make $560,000 in profits in October 2009.
Shimoon pled guilty and sentencing is scheduled for July 8, 2013. He could spend up to 30 years in prison.
Read More