Sharing sales forecasts with stock traders led one Apple supplier to plead guilty.
An Apple supplier executive pleaded guilty to leaking iPhone and iPad secrets to hedge fund traders after a government crackdown on insider training.
Walter Shimoon, a former executive with Flextronics, a company that made chargers for Apple's iPhones, pled guilty to two counts of conspiracy to commit wire fraud and one count of security fraud, according to the New York Times. Shimoon is accused of leaking actual and forecasted sales figures for the iPhone and iPod in 2009, as well as mentioning the iPad, then known by codename "K48. "
“So, you can get, at Apple you can get fired for saying K48…outside of a, you know, outside of a meeting that doesn’t have K48 people in it,” he told a cooperating witness, according to taped calls. “That’s how crazy they are about it.”
Shimoon is the 12th person to plead guilty in the government crackdown of so-called expert network firms. He will be sentenced July 2013. He was fired from Flextronics for allegedly jeopardizing the company's relationship with Apple.
After reading about Shimoon, we can't help but wonder how much rumors about Apple products come through its supplier channels and how much of that comes from executives like Shimoon. If that's the case, then insider trading is likely more rampant than anyone is willing to admit.