Latest reports indicate that Intel CEO Brian Krzanich sold a big portion of his shares in the company after he learned that the company’s flagship PC processor was vulnerable. It is emerging that Google had informed the company about this security vulnerability. A few months later, Krzanich went on to sell $24 million is stock and options. The sale happened before this information was made public.
According to Google, the vulnerability affects processors from Intel, ARM, and AMD. The problem could allow malicious actors to steal crucial data including passwords and other private details. The revelation is a big blow to these major chipmakers. Chip manufacturers like Microsoft and Intel are working day and night to get on top of this story in order to somehow repair whatever damage that has already been done.
Nonetheless, this is not new information for these tech companies. Although it’s only the first time that the public is getting to hear about this, chipmakers and other tech giants have always known that the processors had an issue. Google was the first company to raise the concern and this happened in June last year.
Going by this timeline, it is very clear that Intel knew about the problem before CEO Krzanich sold a big portion of his holdings at the company valued at about $24 million. The sale raised some eyebrows, especially because it left the CEO with only 250,000 shares in the company. This is the minimum that an Intel CEO is mandated to have.
But the story could get more interesting. It is likely that the Krzanich stock sale will attract more scrutiny from various players. The timing is suspect and whether the CEO was acting on insider information or something else will be determined in an inquiry. But we are not there yet. The SEC (Securities and Exchange Commission) has yet to confirm whether it’s going to investigate the issue or not.
Intel released a statement defending its CEO saying that the sale was actually pre-planned. A representative from the company said that Krzanich’s sale wasn’t related to the disclosed vulnerability of the chip. The representative also added that the decision to sell the stocks didn’t break any regulations. The SEC allows CEOs who hold stocks in the companies they manage to sell them through a preplanned schedule. However, Krzanich’s plan to sell the stocks was still hatched after information about chip vulnerability came to light.
Intel shares closed lower after this information was made public this week. The stocks lost 3.4% or an equivalent of $1.59 to end the day at $45.26. A storm is definitely brewing and Intel is trying to get ahead of this issue as soon as possible. The company will also need to address the disclosed vulnerabilities. After all, Intel is one of the biggest chipmakers in the world and its reputation appears to be at stake for now.
