Dell Still Digging up Trouble with Intel

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Dell has gotten in trouble in the past for taking kickbacks from Intel – in fact, court documents have come to light showing that Dell has lied to their stockholders about that very fact. Combined with the recent resurgence in scrutiny about the Round Rock giant knowingly shipping faulty desktops to customers, and the quarter isn’t shaping up to be too bright – at least in the realm of public opinion.

This week, the WSJ reported that Dell, and its founder Michael Dell as well as the CEO at the time, hid the extent to which Intel supplied them with funding. Intel’s funding for multiple quarters – several years ago – is the only reason, in fact, that the computer maker managed to bring their books into the black. During this period, the company publicly told shareholders that the reason for the stability and profitability were due to the strength of its product and operating efficiency.

The U.S. Securities and Exchange Commission levied fines as a result of those actions – to the tune of $100 million to Dell and $4 million specifically to its founder.  The nine figure company fine is a result of charges related to the Intel payments as well as other accounting fraud, while Michael Dell’s personal $4M fine is related to Intel alone. Both Dells concerned agreed to pay the fines without acknowledging the veracity of the charges.




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