Accounting & Tax

Gemstar Ex-CFO Agrees to Settlement

Company had been accused of overstating its total revenues by at least $248 million to meet ambitious projections for revenue growth.
Stephen TaubDecember 13, 2005

A former chief financial officer of Gemstar-TV Guide International Inc. has agreed to pay $25,000 to settle civil charges stemming from the company’s accounting fraud, according to the Associated Press.

The Securities and Exchange Commission alleged that Craig Waggy, the company’s finance chief from September 1997 to May 2002, aided and abetted Gemstar’s reporting and record-keeping violations of federal securities laws.

The SEC had also charged Gemstar’s former co-president, co-chief operating officer, and board member Peter C. Boylan (who also served as co-chairman, chief executive officer, and co-president of Gemstar’s wholly owned subsidiary TV Guide Inc.) and Jonathan Orlick, a former general counsel, executive vice president, and board member. Boylan and Orlick previously agreed to pay about $600,000 and $300,000 respectively.

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Waggy’s attorney, Richard Marmaro, told the AP that his client will still be able to practice as an accountant before the SEC and is still eligible to serve as an officer or director of a public company. Marmaro added that the commission dropped fraud charges against Waggy.

The SEC still must approve the deal, the AP pointed out; a previous agreement fell apart about a year ago.

Last month the commission reached a tentative settlement on undisclosed terms with another Gemstar ex-CFO, Elsie Leung. Former CEO Henry Yuen’s civil trial on SEC charges is under way.