Computer Fraud Suspect Says He’s Victim of Setup

A man charged with giving Intel Corp.’s computer secrets to a competitor claimed Monday that he was being set up by the government after a falling-out over his work as a free-lance spy.

William Gaede, being held on a federal fraud charge, spun a tale of international intrigue in a jailhouse news conference allowed by the FBI.

He is accused of sending a videotape on how to make the Pentium computer chip that runs state-of-the-art personal computers to Advanced Micro Devices Inc., Intel’s archrival in California’s Silicon Valley. He also allegedly stole information on two earlier models, the 386 and 486 chips.

Advanced Micro Devices immediately turned the material over to Intel, the FBI said.

Gaede was a systems engineer for Intel in the Phoenix suburb of Chandler in 1993 and 1994. He had worked for Advanced Micro Devices from 1983 to 1993.

He offered few details about the Pentium accusation, instead laying out a convoluted scenario involving Cuban and U.S. intelligence agencies and an alleged double-cross by the FBI.

“What they did was frame me,” said Gaede, who gave interviews earlier this year in which he admitted stealing secrets and said he had dealings with former Communist governments.

The FBI in San Francisco and U.S. attorneys in Phoenix and San Jose did not immediately return calls seeking comment. The FBI office in Phoenix referred calls to the San Francisco office.

Intel is cooperating in the investigation and reviewing security operations, said Mike Edwards, a spokesman for Intel in Chandler. He would not comment specifically on Gaede or give more details about the case.

Advanced Micro Devices executives did not immediately return phone calls seeking comment.