Walter Shimoon pleaded guilty on Tuesday at a court in Manhattan, joining 11 others who have submitted guilty pleas in a federal sting cracking down on alleged insider trading stemming from expert network firms, The New York Times reports.
Details of the three-year U.S. Securities Exchange Commission investigation of expert networks and supplier channel checks emerged last fall, with many Wall Street analysts voicing surprise at the probe.
Expert network firms connect "industry experts" with Wall Street analysts and managers, but federal prosecutors have accused the firms of knowingly going beyond "permissible market research" and participating in insider trading.
U.S. Attorney Preet Bharara has described the accused individuals as "a corrupt network of insiders at some of the world's leading technology companies " who "sold out their employers by stealing and then peddling their valuable inside information."
Shimoon was arrested last December on the basis of wiretap evidence provided by a cooperating witness. While serving as the senior director of business development at Flextronics, which manufactured chargers for the iPhone, he allegedly provided information on the unreleased iPad, codenamed K48, and an upcoming iPhone, as well as "highly confidential" data regarding Apple's sales forecasts.
"Its a new category altogether. I believe its called K48 ... At Apple, you can get fired for saying K48 ... outside of a meeting that doesnt have K48 people in it. Thats how crazy they are about it," a transcript of a federal wire tap recorded Shimoon as saying.
In addition to criminal charges, the executive faces civil charges, with the SEC seeking restitution and civil fines from Shimoon and five others, as well as bans that would prevent from serving as officers or directors of any public company.