You’ve probably heard by now about the security flaws that were discovered in Intel (NASDAQ:INTC) processors. If that wasn’t dramatic enough, Intel may already have another scandal on its hands. The CEO of the company, Brian Krzanich, sold off as much of his shares in the company as he was legally entitled to do – according to corporate bylaws – earning $39 million in return, and arousing suspicions that he did so because of his prior knowledge of the security breach. Insider trading, anyone?
An Intel spokesperson has said that Krzanich’s trades were completely “unrelated” to the security flaws, but one does have to wonder, especially when you consider that the date set for the sale of his shares was October 30, 2017, three months prior to addressing the security issues publicly but a full five months after Intel first learned of the breach. Intel hasn’t given any further statement on the matter, offering zero explanation for why the abrupt sale of Krzanich’s shares did occur, so the suspicion remains up in the air.
Thursday’s market saw Intel stock close at $44.43, which meant it was down $0.83, or 1.83%, from the previous closing price of $45.26. This is approximately the same amount the stock was going for when Krzanich sold his shares back in October. Ultimately, that means that the Intel CEO didn’t really gain any more than he would have if he were to have sold his shares now after the breach was made publicly known. So was it worth it then? If Krzanich did sell his shares with the knowledge of the security issues, if he did participate in insider trading, was it worth it? Worth all the trouble the accusation is going to bring to him? I doubt it.
Insider trading may not have occurred, as Intel claims. Regardless, the Securities and Exchange Commission may still look into the suspicions and that could cause a lot of damage – to Krzanich and to the company – especially if evidence is discovered that confirms insider trading did occur.
Feature image: depositphotos/quka