Nov. 5 (Bloomberg) -- Atheros Communications Inc. Vice President Ali Hariri became the third corporate executive charged in the Galleon Group LLC insider-trading case, joining International Business Machines Corp.’s Robert Moffat and Intel Corp.’s Rajiv Goel.

Hariri, a manager at Atheros’s broadband networking unit, was placed on leave pending the results of the investigation, Atheros said today at an analysts’ meeting. The company said it would cooperate fully with authorities. Hariri was one of 14 people charged by U.S. prosecutors, part of a probe of an alleged insider-trading scheme totaling as much as $53 million.

Hariri, 38, leaked information on Atheros’s “downward” guidance on its financial performance for the fourth quarter of 2008 to hedge-fund manager Ali Far, according to a complaint by the U.S. Securities and Exchange Commission. Far and partner C.B. Lee are linked to others in an insider-trading ring led by Galleon founder Raj Rajaratnam, who got tips from a network of corporate and financial executives, the government says.

Hariri was arrested today and released on $500,000 bail. He was ordered by U.S. Magistrate Judge Nandor Vadas in San Francisco to secure bail with $250,000 by Nov. 12. Hariri, who lives in San Francisco and appeared in court with Jodi Linker, a federal public defender, was ordered to return to court in San Francisco on Nov. 9 with his lawyer.

Hariri declined to comment after a first court appearance earlier today. Linker declined to comment after the second.

Atheros Chips

Atheros sells chips that are used in Wi-Fi networks, which provide short-range wireless Internet connections. It also makes semiconductors for Bluetooth wireless networks and chips used in global positioning system, or GPS, equipment.

The Santa Clara, California-based company said it only learned of the allegations today, declining to comment further.

Atheros rose 93 cents, or 3.6 percent, to $26.75 in Nasdaq Stock Market trading. The shares have climbed 87 percent this year.

In December, Hariri told Far that his company was going to lower its forecasts for the fourth quarter, according to the complaint. Following a phone call between the pair on Dec. 17, the hedge fund bet that Atheros’s stock would fall, using a short sale, prosecutors said.

After the market closed that day, the company cut its forecast for earnings per share to less than half of its previous prediction. The shares were down about 7 percent when the market opened the next day. The hedge fund made a profit of about $480,000, prosecutors said.

Personal Account

Hariri also provided details of Atheros’s fourth-quarter revenue to Far before its earnings announcement on Feb. 2, prosecutors said. He received information from Far about another unidentified technology company, and Hariri bought shares of that company for his personal account, prosecutors said.

On Feb. 2, Atheros announced revenue of $98.3 million, beating analysts’ estimates and sending the stock up 6.7 percent the next day. Far’s fund bought and sold Atheros stock before earnings were announced and realized a profit of about $390,000, prosecutors said.

Before joining Atheros, Hariri worked at Broadcom Corp. He has bachelor’s and master’s degrees in electrical engineering from the University of Connecticut.

IBM’s Moffat, 53, and Intel’s Goel were charged last month in the case. Prosecutors accused Moffat of leaking information about the earnings of both IBM and Sun Microsystems Inc., as well as a reorganization of Advanced Micro Devices Inc. He was a senior vice president at IBM, managing the company’s hardware business. Rod Adkins is now taking over those duties, IBM said last month.

Intel Executive

Goel, an executive at Intel’s venture capital arm, gave Rajaratnam tips on earnings and an investment in Clearwire Corp., according to prosecutors. The two men were classmates at the University of Pennsylvania’s Wharton School of Business in the early 1980s.

An unnamed AMD executive also provided nonpublic information to the insider-trading ring, prosecutors said. Last week, a person familiar with the matter identified the executive as Hector Ruiz, the former chief executive officer of AMD. Ruiz hasn’t been charged with wrongdoing in the case.

Anil Kumar, 51, a McKinsey & Co. consultant, also participated in the scheme, prosecutors said. He served as a consultant to Sunnyvale, California-based AMD.

The criminal case is U.S. v. Rajaratnam, 1:09-mj-02306, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net.

Last Updated: November 5, 2009 19:14 EST