Oops! Xbox Exec Sold Even More Stock Prior to RROD Admission

Do you remember last month's little stock stink at Microsoft?

Securities & Exchange Commission (SEC) records showed that MS gaming exec Robbie Bach dumped $6.2 million worth of Microsoft shares in advance of the company's public acknowledgement that the Xbox 360 was plagued with a major design flaw, causing the dreaded Red Ring of Death hardware failure.

Oh, and Microsoft also announced it was setting aside $1 billion to deal with the problem.

Now, CNN/Money reports that Bach sold an additional $3 million worth of stock, according to documents filed with the SEC on Monday. Proper reporting of the sale of the additional shares apparently slipped through the cracks. From CNN/Money:

Bach sold $6.2 million worth of Microsoft stock between May 2 and a July 5 announcement that the company would take a $1.5 billion charge related to Xbox repairs. The most recent sales occurred between May 25 and May 30, according to SEC filings. Bach is president of the company's entertainment and devices unit, which includes the Xbox.

But according to the filing Monday, Bach had sold just over $3 million worth of company stock on May 1. Microsoft spokesman Eric Hollreiser said the additional $3 million in sales were not registered in a timely manner with the SEC "as the result of an administrative error."

Normally, a company must register insider sales with the SEC within two days of the transaction...

GP: While it doesn't smell great, Bach didn't save a great deal of money by dumping his shares, which would be the standard motivation for someone trying to sell in advance of bad news. MS stock weathered the Xbox 360 RROD announcement quite well. As CNN/Money notes:

Microsoft (MSFT) shares did not fall significantly following the July 5 announcement, when they were trading at roughly $30. Microsoft shares closed down 2% Monday, to $28.10.