Former AT&T executive pleads guilty to insider trading charges

By Lee Kaelin on

Former AT&T marketing executive Alnoor Ebrahim pleaded guilty to charges of conspiracy to commit wire and securities fraud on Monday, following a US government investigation into an insider-trading scheme in which he leaked sales information about iPhone and BlackBerry smartphones to members of the investment community.

Ebrahim, 57, a US citizen born in Tanzania who resides in Alpharetta, Georgia provided information whilst working for AT&T as an associate director of channel marketing to an unknown company quoted only as an "expert networking firm" between 2008 and 2010, the Department of Justice said.

"I provided insider information concerning AT&T's sales of Apple's iPhone and RIM's Blackberry products, as well as other handset devices sold through AT&T distribution channels," Ebrahim told Manhattan District Judge Paul Oetken.

He had been paid over $180,000 for "consultation calls" with clients of the investment company. He was part of a so-called expert-network ring comprising of employees of specialist firms like Primary Global Research (PGR) who helped to funnel corporate secrets from companies such as AT&T to hedge funds.

Whilst the charges carry a maximum sentence of five years in prison, as part of a plea agreement, the Manhattan federal prosecutors recommended a maximum sentence of two years imprisonment.  In addition to this, he faces fines of around $250,000, or twice the gross gain or loss from the offense of conspiracy.

The DOJ also noted in court that as part of his plea agreement, the former AT&T executive has forfeited the proceeds earned during the course of the conspiracy. He will be sentenced on October 25.

AT&T also released a statement following the news in court, saying they "took this matter very seriously and cooperated fully with the authorities," according to AT&T spokesman Marty Richtman. "The conduct alleged was clearly against our code of business conduct, and Mr. Ebrahim is no longer an AT&T employee."

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