Ten Years for Securities Fraud - II
March 19, 2010
A CEO knew securities fraud was going on inside his company but let it go. That’s what FBI Special Agent Chris Fuelling and his partners in San Francisco found out.
Mr. Schiff: A CEO knew securities fraud was going on inside his company but let it go. That’s what FBI Special Agent Chris Fuelling and his partners in San Francisco found out.
Mr. Fuelling: "He was aware, at the time, that several of his employees were falsely inflating the revenue numbers of the company, and he really did nothing to stop it.”
Mr. Schiff: Fuelling says the CEO took advantage of the situation.
Mr. Fuelling: "He had stock options that benefitted from the prices of the stock going up based on the falsely inflated numbers.”
Mr. Schiff: Fuelling says this securities scheme was ongoing from 1997 to 1999.
Mr. Fuelling: "The software revenues that were reported by the company were falsely inflated by an amount in excess of $100 million. In addition, experts established that the loss to investors from this fraud exceeded $8.6 billion.”
Mr. Schiff: Conviction of securities fraud and circumventing internal accounting controls at a public company has the CEO serving 10 years in prison and paying a fine of a million dollars. I’m Neal Schiff of the Bureau, and that’s the FBI’s Closed Case of the Week.”