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More Misconduct Connected to Microsoft

Misconduct



Summary: Pequot and Samsung in the midst of scandals

MICROSOFT was investigated by the SEC after an employee had blown the whistle on financial fraud. It has been years since then, but the SEC makes a return when it approaches Pequot Capital. From the New York Times:



The firm once invested $15 billion and most recently managed roughly $3 billion. The S.E.C. and the Justice Department recently resurrected their investigation, which focuses on Pequot’s trades in Microsoft securities in 2001. That move followed revelations that Mr. Samberg had paid $2.1 million to a former Microsoft employee, David Zilkha, in 2007. Mr. Zilkha had worked briefly for Pequot six years earlier. The payment came to light recently during Mr. Zilkha’s divorce proceedings.


From MarketWatch: "Pequot gets Wells Notice on Microsoft trades: WSJ"

Hedge fund Pequot Capital and its founder Art Samberg have received Wells Notices from the Securities and Exchange Commission, The Wall Street Journal reported Wednesday on its Web site.


And from Bloomberg: "Pequot, Samberg Said to Be Warned of SEC Claims Over Microsoft"

Pequot spokesman Jonathan Gasthalter said he couldn’t comment on the notices. Kevin Callahan, an SEC spokesman in Washington, declined to comment.

The SEC closed a related probe in 2006, writing in an internal memo that it couldn’t find evidence to support a case. In January, people familiar with the matter said the agency had opened another investigation.


Why is it that companies which deal with Microsoft also find themselves in trouble with the law?

Samsung signed a Microsoft patent deal involving Linux and although Samsung's fraud has not been mentioned for a while [1, 2] it is now back in the headlines:

Ex-Samsung boss convicted for fraud



[...]

The ex-chairman of Samsung Lee Kun-Hee has been found guilty of abuse of trust over a dodgy bond issue.

Lee was fined $89.2m and got a suspended prison sentence.


Samsung also joined Microsoft's Linux 'protection' racket when Lee Kun-Hee was in charge.

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