Tech Company’s CFO Resigns Amid Internal Investigation (Updated)

A small technology company said its Chief Financial Officer has resigned after announcing that it is investigating financial irregularities within the company.

Piranha, Inc., said that the investigation centers on certain loans to a director and former officer that appear to be undocumented and made without the prior approval of Piranha’s board of directors, according to a press release.

As a result of the investigation, Richard S. Berger has resigned as the company’s CFO.

The investigation could result in the restatement of its financial results for the December 31, 2000 year, said the company.

It added that the board of directors has enlisted an outside counsel, Robert A, Forrester, and accounting firm Killman, Murrell & Co., to assist in the investigation.

“Piranha is firmly committed to completing a thorough, expeditious investigation. Piranha will take all appropriate actions necessary based upon the results of this investigation and will promptly notify shareholders of the outcome,” said Edward W. Sample, Chairman of the Board, in a statement.

On May 25, 2001 chief information officer Michael Steele and CEO Larry Greybill resigned from the Board of Directors.

Piranha is a technology-based company with a line of digital asset management products and services.

Its stock traded as high as $51.75 back in March 2000. But, it closed Tuesday at 41 cents a pop.

What Will the Fed Do?

Has the economy hit bottom?

That’s one of the big questions facing the Federal Reserve Board as it gears up for its big interest rate announcement on Wednesday afternoon following two days of meetings in Washington, D.C. An official announcement is scheduled for around 2:15 p.m. (ET) and as usual, CFO.com will bring you the verdict immediately after it is delivered.

According to a Reuters poll of firms that trade directly with the Fed, 14 dealers expect the Fed to cut rates by 25 basis points while 11 expect a 50-basis point cut.

However, the meeting takes place even as the government trotted out stronger-than-expected data on consumer confidence, new home sales and orders for big-ticket manufactured goods.

Oracle is Optimistic

Meanwhile, after the stock markets closed on Tuesday, Oracle delivered upbeat news when Larry Ellison, founder and chief executive, said that earnings in the current quarter “look a lot stronger,” with big deals coming back after crumbling in a weak U.S. economy, according to published reports, which quoted the exec at a press conference.

“Our current quarter looks a lot stronger than our previous quarter,” Ellison said. “We’re seeing some of the big deals coming back.”

On June 18, Oracle reported fiscal fourth-quarter earnings that met consensus forecasts and it said it would see “zero” revenue growth and flat earnings of 8 cents a share in its first quarter, generally its weakest.

Today’s Layoff News

Lucent Technologies Inc. is considering layoffs of another 10,000 employees, according to The Wall Street Journal. Remember, the company has already announced layoffs of 10,000 employees and is offering early retirement to another 13,000 employees. Also, the company is expected to cut its work force by another 12,000 when it sells its fiber-optic business and two manufacturing plants.

The Nasdaq Stock Market cut 140 people, or 11 percent of its total work force, its first cuts in nearly 15 years, according to The Journal.

Metricom Inc., a designer of wireless telecommunications systems, said it cut its staff by 23 percent in order to save cash. In March, Metricom cut 179 jobs.

CNS Inc., known for its Breathe Right nasal strips and other health care products, said it has cut 25 percent of its work force as part of a restructuring. it restructures.

From the CFO.com “Brief” Case

Conseco Inc. sold $400 million of bonds, its first offering since being downgraded to junk status last year. It plans to use the proceeds to pay down bank loans. Conseco sold 10.75 percent seven-year notes to yield 11 percent, at the high end of the 10.75 to 11 percent expected range. The notes are rated B1 by Moody’s and BB-minus by Standard & Poor’s.

Lucent Technologies Inc.’s debt ratings were cut to junk status by Moody’s and Fitch. Two weeks ago, Standard & Poor’s cut its ratings

Sempra Energy priced $500 million of 6.8 percent 3-year notes to yield 6.818 percent, or 245 basis points over Treasuries. Led by J.P. Morgan and Salomon Smith Barney, the issue was rated A1 by Moody’s and A by S&P. Sempra is the parent of Southern California Natural Gas.

Internet services company Rare Medium Group Inc. said it would restate earnings to reflect a shift of $3.7 million in revenues to the first quarter of 2001 from the prior year. The company said it performed services for a client that were not completed until the first week of January 2001.