Kent Kalkwarf, the former chief financial officer of Charter Communications Inc., pleaded guilty to federal fraud charges for his role in a scheme to boost subscriber numbers and financial results, according to the Associated Press.
He is the fourth former executive of the cable company controlled by Microsoft Corp. co-founder Paul Allen to admit to playing a role in the deception, the wire service noted.
Kalkwarf pleaded guilty to a felony count of conspiracy to commit wire fraud. The court dropped the other 13 charges against him. He had been scheduled to stand trial beginning February 7 on 14 counts of mail fraud, wire fraud, and conspiracy to commit wire fraud, according to the report. The former finance exec faces up to five years in jail and as much as $250,000 in fines when he is sentenced on April 22, said the AP.
Kalkwarf admitted to inflating Charter’s revenue in 2000 to enable the company to meet Wall Street’s expectations. In August 2000, he gave money to two Charter suppliers of digital set-top boxes, asking them to overcharge Charter by $20 more per set-top box. Under the scheme, the suppliers would return the money as advertising revenue, according to the AP. As a result of the scheme, Charter overstated revenue and cash flow by $17 million for 2000, according to the report.
Although Kalkwarf is the last of four former executives to plead guilty after being indicted in July 2003, U.S. attorney Jim Martin reportedly said in a statement: “I am not ready at this point to say that this concludes the investigation. In the last several weeks, the [former chief financial officer] and [former chief operating officer David Barford] agreed to cooperate with our investigation, and we’re certainly going to explore everything they have to say.”
Kalkwarf’s attorney, Robert Haar, told the St. Louis Post-Dispatch: “The bottom line is he accepts responsibility for the count on which he entered the guilty plea, and he looks forward to moving beyond this.”
Charter representative David Andersen told the paper Kalkwarf left the company in December 2002 after an internal investigation. He reportedly added that prosecutors have said that none of Charter’s current officers or directors is a target of the inquiry.