Analyst pleads guilty to insider trading of tech stocks

Defendant milked industry contacts for tips on IBM, Sun and AMD

An analyst who was accused of trading IBM, AMD and Sun Microsystems stocks, using inside information, has pleaded guilty to fraudulent trading.

Danielle Chiesi, 45, a former consultant for Bear Stearns' New Castle Funds, was arrested by US authorities in October 2009. She allegedly earned more than $4 million by trading on insider information.

Chiesi was arrested with a number of others and is the latest of 16 people to plead guilty. In total, the traders are accused of earning $60 million illegally.

She is said to have had an affair with a senior IBM executive, Robert Moffat, who was accused of passing confidential information to her. He was jailed for six months last year for his part in the financial scandal.

But Moffat was only one of a number of well-placed sources Chiesi and others are said to have gleaned information from, in order to make illegal trades. She is also alleged to have gleaned inside information from Google, AMD and Sun.

Prosecutors allege Chiesi and others traded on information given by insiders at hedge funds, public companies and investor relations firms. Prosecutors have ordered a number of technology companies to appear in court to give evidence, along with hedge fund bosses.

Before pleading guilty, Chiesi was facing a jail term of up to 25 years. She could still spend over three years in prison, after she is sentenced in May.

"This guilty plea causes me great pain and I'm deeply ashamed by what I did," said Chiesi. "I ruined a 20-year career that I truly loved and have brought disrepute to my profession."

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