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Former AMD CEO Hector Ruiz Resigns From GlobalFoundries in Wake of Trading Scandal

Jason Mick (Blog) - November 2, 2009 12:15 PM

After being implicated in passing insider information during his time as Chairman of AMD, former AMD CEO Hector Ruiz is stepping down from his position as Chairman and AMD-spinoff GlobalFoundries. (Source: Wikimedia Commons)

Government documents indicate that charges against Mr. Ruiz may be coming. Several executives have already been arrested and charged in the case, including billonaire Indian investor Raj Rajaratnam, pictured here, or allegedly masterminded the illegal scheme. (Source: AP)
AMD's partner, GlobalFoundries loses a key part of its leadership

The casualties of the largest insider trading case to date continue to mount. The case is already promising to fell IBM's ranking hardware executive and expected CEO candidate, Robert Moffat. It also has taken down a prominent executive in Intel's Capital department. And now it has claimed a third major tech corporation casualty, former AMD CEO and Chairman Hector Ruiz.

Mr. Ruiz was long seen as one of the great rags-to-riches stories of the electronics industry. Growing up in Mexico and learning English from a Methodist missionary, Ruiz would go on to get a PhD in electrical engineering and become a critical player at Motorola. He was rewarded for his 22 year campaign with Motorola with a ranking position at chipmaker AMD in 2000 and became AMD's CEO.

During his time with AMD he made some smart moves -- cutting costs and spinning off the expensive fabrication business. He also crafted the purchase of ATI, which now is one of AMD's most valuable properties. However, much negativity continues to surround Mr. Ruiz to date due to his inability to make his company truly competitive against market leader Intel, and AMD's tendencies under his leadership to miss important CPU deadlines (their Barcelona processor was over a year late).

In 2008 Mr. Ruiz (then Chairman of AMD, having stepped down from the CEO position) left the company to become Chairman at its spinoff, GlobalFoundries. Reportedly during that time he leaked information of the upcoming spinoff to a member of New Castle Investments, Danielle Chiesi, several times. Ms. Chiesi, working in concert with Raj Rajaratnam, billionaire and CEO of the Galleon investment group, then made key purchases of AMD stock, expecting it to soar when the news was announced.

The groups plot was undone when the market tanked during a recession. New Castle and Galleon lost money on their AMD investments. However, that did not detract from the illegal nature of their behavior -- behavior that was carefully noted by federal agents working for the U.S. Securities and Exchange Commission (SEC).

Now GlobalFoundries has announced that the shamed Mr. Ruiz is stepping down. The resignation notice states that Mr. Ruiz will be taking a leave of absence until January, when he will officially leave the company on January 4, 2010. Replacing him will be Alan E. ‚ÄúLanny‚Ä