Risk Management

Delphi Nine Avoid Criminal Charges

The Justice Department decides not to pursue the case, but seven of the nine still face civil charges.
Stephen TaubNovember 27, 2007

The Justice Department will not file criminal charges against nine former Delphi Corp. officials who were investigated for accounting fraud, a DOJ spokesman confirmed to CFO.com.

The spokesman declined to say why the case was abandoned, something that also was not made clear in a letter DOJ sent last week informing a federal judge in Detroit of its decision.

The nine former executives include CEO J.T. Battenberg, CFO Alan Dawes, treasurer John Blahnik, controller and chief accounting officer Paul Free, director of capital planning and pension analysis Milan Belans, director of financial accounting and reporting Catherine Rozanski, IT department finance director Judith Kudla, financial accounting and reporting director Laura Marion, and chief information officer Peter Janak.

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Not all of them, however, are totally in the clear. Battenberg, Dawes, Blahnik, Free, Belans, Rozanski and Kudla were among 13 people charged last year for perpetrating the massive accounting fraud at the auto parts maker. At that time the SEC also settled financial fraud charges against Delphi, which did not admit or deny the allegations.

The SEC alleged that between 2000 and 2004, Delphi and its executives engaged in several schemes that resulted in the auto parts maker materially misstating its financial condition and operating results in regulatory filings.

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