Ex-SanDisk executive sentenced to probation for inside tips

Tue Jun 25, 2013 12:20pm EDT
 
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By Nate Raymond

NEW YORK (Reuters) - A former executive of SanDisk Corp SNDK.O was sentenced on Tuesday to a year of probation after admitting to supplying illegal tips to a hedge fund consultant.

Donald Barnetson, 39, pleaded guilty in February 2012 to a charge of conspiracy to commit wire fraud and securities fraud as part of a broad U.S. government crackdown on insider trading.

At a hearing in federal court in New York, U.S. District Judge Kimba Wood also ordered Barnetson to pay a $4,000 fine.

Barnetson was one of a number of defendants charged as part an insider trading investigation focused on expert networking firms, which connect high-end investors with industry experts.

Prosecutors said that Barnetson, a senior director at SanDisk, a maker of memory chips, had provided confidential information to a consultant who ran a research firm in Portland, Oregon.

The consultant, identified in court papers as John Kinnucan, obtained insider information about companies including SanDisk, F5 Networks Inc FFIV.O and Flextronics International(FLEX.O: Quote), the documents said.

Kinnucan then sold the information to clients of his firm, Broadband Research LLC, including hedge funds and money managers, prosecutors said.

Barnetson provided confidential information about SanDisk and Apple Inc (AAPL.O: Quote), one of the companies SanDisk supplied with electronic components.   Continued...