Turns out one of the government's key witnesses in its insider trading case against the Galleon Group hedge fund - the one that's brought down a senior IBM executive a heartbeat or two away from IBM's CEO - used to be employed by Intel and was charged in 2001 in a sealed criminal complaint with wire fraud for sending material information about Intel's financials to Galleon according to a story by a Pulitzer Prize-winning reporter at the San Joe Mercury News.

Roomy Khan has been identified by the Wall Street Journal and the New York Times as the "confidential" informant the SEC calls "Tipper A" in its current suit against billionaire Galleon CEO Raj Rajaratnam and his five confederates, including Robert Moffat, the guy who ran IBM's $19-billion-a-year server and storage unit until last week. It's supposed to be the largest case of insider trading involving a hedge fund ever brought to light.

The Mercury News says the information Khan faxed to the Galleon covered the first two quarters of 1998 and included backlog and billing reports, product pricing and MPU sales data. The information was sent from an Intel fax machine in Santa Clara, California to Galleon in New York.

The government, which used wire taps to bust open the case, which dates back to 2006 and involves the stock of 10 public companies, says that one of the companies whose stock Galleon traded on insider earnings information was Polycom, which put senior VP Sunil Bhalia, who ran its voice communication business, on administrative leave late last week without explaining why, according to an SEC filing last Thursday.

Khan pleaded guilty in 2001 and was sentenced to six months of home detention, a $30,000 fine and $120,000 restitution, according to Bloomberg who quoted an FBI spokesman.

She's reportedly been a so-called cooperating witness in the latest case since November of 2007 in hopes of a reduced sentence on charges of securities fraud and conspiracy.

Rajaratnam, a dual citizen of the US and Sri Lanka, reportedly figured Khan was taping him and was about to leave the county when he was arrested 10 days ago. He is currently free on $100 million bail and is shutting down Galleon.

Khan also allegedly passed on information on Google and Hilton Hotels. Rajaratnam allegedly got insider information on Intel's 4Q06, 1Q07 and 3Q07 earnings and outlook as well as Intel's big investment in Clearwire from Intel executive Rajiv Goel, now also on administrative leave.

The ring had an uncharged insider at AMD described by the Justice Department in its suit as the executive who's "been preaching this deal for so long," meaning the fab spin-off and frankly there aren't too many of those.