A Case of Cooked Books and a Cover Up

A Case of Cooked Books and a Cover Up

07/25/03

On July 22, three former executives of the Rent-Way Corporation pled guilty to cooking the books of the nation's 2nd largest rental-purchase company in the United States. The three conspired to meet the projected earnings they had reported to Wall Street by making fraudulent entries that underreported operating expenses and misstated income and earnings per share in the company's SEC filings in 1999 and 2000.

Each of the men may be fined and sentenced to imprisonment. In U.S. Attorney Mary Beth Buchanan's words, "these convictions send a strong message to companies in this district and throughout the United States that executives who lie on company financial statements to manipulate earnings and circumvent the internal accounting controls of the companies they lead will be prosecuted to the fullest extent of the law."

The investigation, which was initiated by a tip from the company's headquarters in Erie, Pennsylvania, was conducted by the FBI Pittsburgh Field Office and the Securities and Exchange Commission. The Rent-Way Corporation was lauded for fully and openly cooperating with investigators, thereby alleviating some of the significant consequences that could have attached from the misconduct of its former executives.

To stop corporate fraud, you can make a difference: Call the FBI's Corporate Fraud Hotline at 888-622-0117.