Sci-tech

Intel CEO sold $24M in stock after firm knew about cyber vulnerabilities

Intel CEO sold $24M in stock after firm knew about cyber vulnerabilities

CEO Brian Krzanich sold off a total of $24 million worth of stocks through combinations of owned shares and exercising option contracts after it was reported that Intel's processor chips had a serious security flaw. The representative continued: "He continues to hold shares in-line with corporate guidelines". This then allowed him to sell off $39 million worth of stock in November, leaving him with only the minimum amount of stocks that Intel requires its CEO to hold.

Intel revealed Wednesday that most of the processors running the world's computers and smartphones have a security flaw that makes them vulnerable to attack.

Intel says the stock sale was unrelated to the vulnerability, but came as part of a planned divestiture program.

But while the public is just being informed about the security problem, tech companies have known about it for months.

Intel is also facing at least three separate class-action lawsuits over the new security vulnerability.

According to Business Insider, Google informed Intel of the security flaws in June of past year.

More news: Injured players can compete through their PlayStation versions, Australian Open announces

The shares were sold in accordance with a SEC Rule 10b5-1 plan, which is meant to prevent illegal insider trading by allowing company executives to create predetermined, automatic selling plans.

In this case, Krzanich set up the plan just a month before the shares were sold, in the period between Intel's initial discovery of the exploit, but before its public disclosure.

Regulatory filings showed Mr Krzanich pocketed about $25m (£18.4m) before tax from the sale of stocks and options in late November. He sold 242,830 shares in one transaction and 2,913 shares in a separate transaction, with the average price for those shares coming out to $44.55 per share-allowing the Intel CEO to pocket about $11 million. The shares of Intel witnessed a slight drop ever since the news of security flaw came out in public, it is now being traded at around $44.23.

However, according to the SEC filing, Krzanich only put that plan in place on October 30, 2017, meaning he knew about Meltdown and Spectre.

Reportedly, Intel and other chip makers were already notified of the hardware bugs in June.

Photo of Brian Krzanich courtesy Intel; share price graph courtesy Google Finance, Yahoo! It's common for a company dealing with security flaws to sit on the information in hopes of fixing the problem before hackers discover the vulnerabilities.


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