Discussion Summary of Recent Frauds #2 (Forbes): Allegations Latest Developments Company Comment We Agencies Three Rigas family members Founding Rigas family SEC; and two other ex-executives collected $3.1 billion in Pennsylvania have been arrested for fraud. loans backed Did not return repeated and New The company is suing the entire by Adelphia; overstated calls for comment. York federal Rigas family for $1 billion for results by inflating capital (otc: - grand juries breach of fiduciary duties, expenses and hiding debt. - ) among other things. As the ad market faltered about the inquiry and AOL's purchase of Time intensified when the DOJ Warner loomed, AOL ordered the company to AOL inflated sales by booking preserve its documents. AOL Time July barter deals and ads it sold said it may have overstated Warner on behalf of others as SEC; DOJ revenue by $49 million. New No comment. revenue to keep its growth concerns are afoot that the (nyse: - rate up and seal the deal. company may take another - ) AOL also boosted sales via goodwill writedown, after it "round-trip" deals with took a $54 billion charge in advertisers and suppliers. April. Andersen was convicted of Shredding documents obstruction of justice in June Arthur related to client Enron and will auditing public Did not return repeated SEC; DOJ after the SEC launched an firms by Aug. 31. Andersen lost calls for comment. inquiry into Enron hundreds of clients and has seen massive employee defections. Bristol will continue to Inflated its 2001 revenue by cooperate fully with the $1.5 billion by "channel SEC. believe that Efforts to get inventory back to Myers July stuffing," or forcing the accounting acceptable size will reduce Squibb wholesalers to accept more SEC treatment of the earnings by 61 cents per share inventory than they can sell domestic wholesaler (nyse: - through 2003. to get it off the inventory buildup has - ) manufacturer's been completely appropriate. SEC; CFTC; Houston U.S. CMS attorney's Appointed Thomas J. Webb, a May Executing "round-trip" Energy office; U.S. former Kellogg's CFO, as its trades to artificially boost No comment. (nyse: - Attorney's new chief financial officer, energy trading volume Office for effective in August. - ) the Southern District of New York
Discussion Summary of Recent Frauds #2 (Forbes): Allegations Agencies Latest Developments Company Comment (otc: - - ) Founding Rigas family collected $3.1 billion in loans backed by Adelphia; overstated results by inflating capital expenses and hiding debt. SEC; Pennsylvania and New York federal grand juries Three Rigas family members and two other ex-executives have been arrested for fraud. The company is suing the entire Rigas family for $1 billion for breach of fiduciary duties, among other things. Did not return repeated calls for comment. AOL Time Warner (nyse: - - ) July As the ad market faltered and AOL's purchase of Time Warner loomed, AOL inflated sales by booking barter deals and ads it sold on behalf of others as revenue to keep its growth rate up and seal the deal. AOL also boosted sales via "round-trip" deals with advertisers and suppliers. SEC; DOJ about the inquiry intensified when the DOJ ordered the company to preserve its documents. AOL said it may have overstated revenue by $49 million. New concerns are afoot that the company may take another goodwill writedown, after it took a $54 billion charge in April. No comment. Arthur Shredding documents related to client Enron after the SEC launched an inquiry into Enron SEC; DOJ Andersen was convicted of obstruction of justice in June and will auditing public firms by Aug. 31. Andersen lost hundreds of clients and has seen massive employee defections. Did not return repeated calls for comment. Squibb (nyse: - - ) July Inflated its 2001 revenue by $1.5 billion by "channel stuffing," or forcing wholesalers to accept more inventory than they can sell to get it off the manufacturer's SEC Efforts to get inventory back to acceptable size will reduce earnings by 61 cents per share through 2003. Bristol will continue to cooperate fully with the SEC. We believe that the accounting treatment of the domestic wholesaler inventory buildup has been completely appropriate. CMS Energy (nyse: - - ) May Executing "round-trip" trades to artificially boost energy trading volume SEC; CFTC; Houston U.S. attorney's office; U.S. Attorney's Office for the Southern District of New York Appointed Thomas J. Webb, a former Kellogg's CFO, as its new chief financial officer, effective in August. No comment. Myers
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