Feeds

Big Blue union calls for probe of all IBM execs

Insider trading arrest reaction

The Essential Guide to IT Transformation

Union organizers are rallying around the recent arrest of IBM executive Robert Moffat on insider trading charges to call for a broader investigation into all the company's heads.

Alliance@IBM, a union that represents a small number of IBM employees, posted an open letter on its website Tuesday asking the US Department of Justice and US Securities and Exchange Commission to launch a probe of all IBM executives. On behalf of current and former employees at Big Blue, the organization is an extremely vocal critic of IBM outsourcing and its downsizing of domestic operations.

"There's been an awful lot of rumor and innuendo over the years from employees who are very concerned that they see IBM taking a turn towards what they believe is unethical behavior and possibly illegal behavior," alliance@IBM national coordinator Lee Conrad told El Reg. "While this can't be proved at this point, there's an underlying feeling that this arrest of Moffat might just be the tip of the iceberg."

Moffat is senior vice president and general manager of IBM's Systems and Technology Group, and before his arrest, he was seen as an heir apparent to CEO Sam Palmisano. He, along with five others, were charged October 16 over an alleged insider trading scheme that investigators said netted $20m in illegal gains.

Moffat is accused of passing information to a portfolio manager at hedge fund New Castle Funds regarding IBM revenues and profits ahead of when the numbers went public in late 2008 and early 2009. IBM has placed the executive on leave following the charges. Moffat's attorney says his client is innocent.

In an open letter posted on its website, Alliance@IBM questions whether Moffat's alleged actions involve more than just one executive at IBM – particularly in light of Moffat being groomed to become the company's next chief executive. Conrad tells us Alliance@IBM has faxed its call to investigate to the SEC and sent it via email to the DoJ. It also plans to distribute the letter to select politicians that oversee large IBM communities, such as in New York and California.

According to Conrad, many IBM employees herald the hiring of former CEO Louis Gerstner in 1993 as the beginning of IBM's loss of respect for its workers.

"What employees feel and what the Alliance feels is that the current crop of IBM executive have pretty much broken faith with the employees and the communities that IBM does business in," he said.

The Alliance@IBM website posted a poll October 19 asking whether readers believe all IBM executives should be investigated for unethical or illegal activities in light of Moffat's arrest. The results, as of publication, are 476 voting yes; 182 voting no; and 1 vote for "not sure." This, of course, is an internet poll on a union website – so the results are almost definitely skewed.

IBM representatives did not immediately respond to our request for comment on this particular matter. ®

The Essential Guide to IT Transformation

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.