Flextronics Executive Pleads Guilty to Leaking Apple Secrets to Research Firm

[MacRumors]

The New York Times reports that former Flextronics executive Walter Shimoon has pleaded guilty to two counts of conspiracy to commit wire fraud and one count of security fraud over his role in leaking insider information on Apple's iPhone and iPad plans to research firm Primary Global Research.

Flextronics manufactured chargers for the iPhone, giving Shimoon access to nonpublic information on Apple's internal sales forecasts for the device, which he then shared with Primary Global Research in his role as a "consultant" for the firm.

In addition to sales figures, prosecutors said Mr. Shimoon also tipped a cooperating witness to Apple's plans to develop a new iPhone. But later in the call, according to a transcript from prosecutors, Mr. Shimoon leaked word of an even more secret product in development, the iPad, which at the time was referred to as 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."

Primary Global Research has been the target of a federal investigation into "expert networks" that solicit employees offering insider information and provide that nonpublic information to Wall Street money managers to facilitate insider trading. A number of arrests have been made over the firm's collection of insider information on Apple, Dell, AMD, and other tech companies.

Article Link: Flextronics Executive Pleads Guilty to Leaking Apple Secrets to Research Firm

 

[Sackvillenb]

No leaks to Macrumors though?

 

[nwcs]

The k48 thing I remember being reported here. Still, I'm glad it's getting cleaned up. I like rumors or I wouldn't be here but I dislike insider trading much more. In the end that hurts all of us.

 

[Tiger8]

waiting for the usual haters to moan:
"Apple is ruthless and Evil!"
"Steve worships money!"
"I don't see what's the big deal in leaking this!"

 

[silentnite]

But of course there are leaks of secret information. How else would Stock traders & The big bosses become so rich in Wall Street, they can't be that smart. This type of thing happens every single day.

 

[chico123]

Albert Kim.

apple is always right.

 

[motulist]

Busted! And I'm glad. Aside from the fact that it was illegal and unethical, I also like there to be more surprise when Apple releases a new product. Yes, I'm on a rumors site, but that's part of the fun, the tit-for-tat back-and-forth. Over the past few years the rumors have been too good and I've known most of what was gonna be releases well before it actually was. I'm happy if Apple will be able to surprise me with its products again for a year or two.

 

[*LTD*]

Busted, thankfully.

K-48. Sounds like a secret Soviet-era sub.

 

[iAlan]

Busted, thankfully.

K-48. Sounds like a secret Soviet-era sub.

Apple is making a secret soviet-era sub? You heard it here first from *LTD*

That being said, rumours and stories are all part of the game - but rumours are rumours, not insider information that can lead to insider trading. It isn't a fine line if you obtain your information illegally and for the specific purpose reportedly discussed here (insider trading)

Sorry if I sound naive.

がんばるう日本

 

[globalhemp]

Shows Them...

When you leak info, ... the Men In Black Turtlenecks will come to get 'cha!

 

[Truffy]

All this talk of K48 makes me want to buy an iPad.

 

[igazza]

without rumors there is no apple

 

[Popeye206]

Although I love getting hints on what might be coming, I must say, I love the excitement of when a new product that we didn't expect is announced. Like when the iPhone was introduced. Or when they introduced the Developers program for the iPhone. Although we knew something was in the works, hearing the actual deal was amazing and mind blowing.

I hope Apple can always keep an element of surprise for us. I think it's part of their Mojo that makes them fun to watch.

 

[Cinch]

Wirelessly posted (Mozilla/5.0 (iPhone; U; CPU iPhone OS 4_2_8 like Mac OS X; en-us) AppleWebKit/533.17.9 (KHTML, like Gecko) Version/5.0.2 Mobile/8E401 Safari/6533.18.5)

The iPhone is not ergonomic now because it is too thin to be held without the aid of a case, IMHO

 

[JHankwitz]

But of course there are leaks of secret information. How else would Stock traders & The big bosses become so rich in Wall Street, they can't be that smart. This type of thing happens every single day.

Something happening every day makes it acceptable? I think not! Without secrecy, innovation doesn't get rewarded and stops it in it's tracks.

 

[GenesisST]

I'm happy if Apple will be able to surprise me with its products again for a year or two.

Like the iPod HiFi?

 

[RalfTheDog]

But of course there are leaks of secret information. How else would Stock traders & The big bosses become so rich in Wall Street, they can't be that smart. This type of thing happens every single day.

The people who make big money on Wall Street don't make it by making good trades. They make it by talking less than smart people into making bad trades. I find it funny when one of our brokers called up and told us they could make our company more money if we let them manage our account.

"How much have you guys made in the last year? "

"No one had made money this year, but we have lost far less than most."

"Look at our account."

"... Never mind, have a nice day."

 

[JAT]

Where are the guys who say the USA doesn't have laws against this? Weird, thought they'd be here.

 

[Dont Hurt Me]

All of this is getting kind of silly, but the lawyers will make a ton of $$$ doing nothing. Ridiculous because technology will be obsolete before you can say new iphone or ipad. K48 is a submarine so perhaps this new item can be submerged in water and still work!

 

[AAPLaday]

Hmm i used to work for Flextronics a few years ago. They make phones for Sony Ericsson, RIM and printers for companies like HP. I was part of an experimental UK based operation that never really got off the ground. They have huge city like manufacturing plants in China. If they have been leaking insider information then i have no sympathy for them.

 

[johncarync]

"So at Apple you can get fired for saying K48 outside of a meeting that doesn't have K48 people in it. That's how crazy they are about it."

Hey Walter, if you think that's crazy, you won't believe what they do when a non-Apple employee talks about their secrets.

 

[duaneu]

Only 21 comments in four hours? Maybe this isn't really front page material...

 

[*LTD*]

All of this is getting kind of silly, but the lawyers will make a ton of $$$ doing nothing.

If they were doing "nothing", they wouldn't be used by Apple. Apple ensures their rights are protected by using lawyers. Looks lie those do-nothing lawyers are doing a pretty decent job.

Ridiculous because technology will be obsolete before you can say new iphone or ipad.

The "obsolete" iPad is currently rendering every other tablet around it obsolete and taking us into the Post-PC era. Playing it close to the vest, guarding secrets, and controlling every aspect of information flow (with legal backing) helps make this possible.

 

[Glideslope]

K48, K48, K48, K48. Phew, now I feel better.

 

[steadysignal]

K48, K48, K48, K48. Phew, now I feel better.

really?