Newest IMAX Accounting Gaffe: Real Estate

Adding to a seemingly nonstop series of accounting problems, IMAX Corp. says it will restate its financial statements for 2006 and the first two quarters of 2007 due to improper accounting of seven real estate leases. The total amount of the revision will be between $5.5 million and $6.5 million,...

By Stephen Taub • Oct. 5, 2007

SEC Balks at Split-Trial Idea in Fraud Case

The Securities and Exchange Commission has asked a judge to deny two former Qwest Communications managers’ request to have their civil charges addressed separately from that of their former bosses, ex-CEO Joseph Nacchio and ex-CFO Robert Woodruff.In a brief filed in the U.S. District Court for th...

By Sarah Johnson • Oct. 5, 2007

Ten Ways to Defuse Shareholder Activists

Today’s new breed of activist investor uses modern methods to put corporate leaders in the crosshairs: blogs on the Internet, wikis, and video that helps them create what corporate communications firm Brunswick Group calls “a wolfpack mentality.” And to help executives understand and counter the...

By Alan Rappeport • Oct. 4, 2007

Pension Fund to Review Countrywide’s Books

A Delaware judge has ordered Countrywide Financial Corp. to provide detailed information about its stock options granting practices to a pension fund that filed a lawsuit claiming the company distributed executive stock rights at “unusually suspicious and lucrative times,” according to the Los A...

By Stephen Taub • Oct. 4, 2007

Cheney Blamed CFO for Halliburton Impropriety

Vice President Dick Cheney, in sworn testimony to the Securities and Exchange Commission in 2004, blamed former Halliburton Co. finance executives for questionable accounting practices, and said he had no “specific recollection” of an alleged conversation with the defense contractor’s former CFO ...

By Stephen Taub • Oct. 3, 2007

SEC Settles Disclosure Beef with Tidewater and Its CFO

The Securities and Exchange Commission issued a cease-and-desist order against Tidewater Inc. and chief financial officer James Lousteau over alleged inaccurate disclosures related to vessels taken out of service. The regulator said Tidewater, an operator of offshore service vessels, filed finan...

By Stephen Taub • Oct. 3, 2007

Enron: Citigroup Muzzles Employees

Enron has accused Citigroup of preventing its former employees from testifying on what they know about the bank’s involvement with the former energy giant before it plunged into bankruptcy in late 2001.A lawyer representing Enron’s creditors filed a letter on Monday with the U.S. Bankruptcy Cour...

By Stephen Taub • Oct. 3, 2007

Cendant’s Forbes Loses Appeal

Former Cendant Corp. chairman Walter Forbes, a high-profile player in reportedly the largest accounting fraud of the 1990s, lost his appeal, according to the Associated Press.Last fall, in his third trial, Forbes was found guilty of conspiracy to commit securities fraud and two counts of making f...

By Stephen Taub • Oct. 2, 2007

Nazareth to Leave SEC

After nearly a decade of working at the Securities and Exchange Commission, commissioner Annette Nazareth is stepping down. She has not specified when she will leave the SEC but theoretically could stay in her current role until 2009. Nazareth’s announcement on Tuesday has long been speculated. H...

By Sarah Johnson • Oct. 2, 2007

Refco Shareholders Target Law Firm

Refco shareholders have expanded their finger-pointing against the brokerage’s business partners for their alleged role in contributing to the firm’s 2005 collapse. On Monday, the shareholders filed a lawsuit against Refco’s former lead counsel, Mayer Brown LLP, and Joseph Collins, one of its sen...

By Sarah Johnson • Oct. 2, 2007

Former Dynegy CFO Settles SEC Fraud Charges

Five years after settling its $300 million accounting fraud case against Dynegy, the Securities and Exchange Commission has settled a related complaint against the energy company’s former CFO Robert Doty and two of his ex-coworkers. According to the SEC, Doty was involved in the decision-making s...

By Sarah Johnson • Oct. 2, 2007

Chief Carbon Officer

The “chief carbon officer” designation is not yet in widespread use, but it can only be a matter of time. Such is the speed at which the carbon issue is zooming up the ranks of business concerns that there is already talk of a skills shortage in this burgeoning area.“Four years ago, when you talk...

By Tony McAuley • Oct. 1, 2007

Hard Cell

Dave Lemus, CFO of German biotechnology company Morphosys, has a vivid memory of when the company launched its IPO in 1998. After a very technical presentation to a group of investment analysts from Morphosys’ banking consortium, there was complete silence. “I was pretty sure nobody really had an...

By Eila Rana • Oct. 1, 2007

York Settles Bribery Case with Iraq Connection

York International has agreed to pay $22 million to settle a number of civil and criminal bribery charges, including allegations related to the United Nations’ Oil for Food Program for citizens of Iraq.In its deal with the Securities and Exchange Commission, the heating, ventilation, air conditio...

By Stephen Taub • Oct. 1, 2007

2 Accountants Settle SEC Charges in Dell Case

Three men who were accountants at Dell Inc. in 2005 were charged by the Securities and Exchange Commission with illegally trading on insider information, and two of them agreed to settle the charges.According to the SEC, Salvador Chavarria, John A. Nieto, and Glenn D. Leftwich worked as accounta...

By Stephen Taub • Oct. 1, 2007

The Long Trail

Deep underneath an industrialpark in Lenexa, Kansas — not far fromShawnee Mission Lake and ArapahoPark — the work goes on. In a vast undergroundwarehouse, historians and archivistscarefully unpack endless rows of boxes. Thecartons, sent from far-flung federal warehouses andobscure outposts on Ind...

By John Goff • Oct. 1, 2007

Who Owns Your Stock?

When asked who owns his company’s stock, CFO David Bronson laughs. “I wish I knew,” he says. Despite an active investor-relations program at the company, medical-supply distributor PSS/World Medical, plenty of shares change hands without Bronson ever knowing who is buying or selling. “I don’t und...

By Kate O'Sullivan • Oct. 1, 2007

AFC Beats Insurer in D&O Case

A federal court has ordered the former insurance carrier of AFC Enterprises to pay the company $24 million in a dispute involving its directors’ and officers’ liability policy, AFC says.The franchisor and operator of Popeyes Chicken & Biscuits had sued Executive Risk Indemnity, a unit of Chub...

By Stephen Taub • Sept. 28, 2007

Dell, Oracle Open Political Books

Dell and Oracle are two of the latest companies to adopt political disclosure and accountability policies as a way of giving shareholders a better picture of how much they donate to campaigns. Thirty-three corporations have adopted political-disclosure policies since 2005, according to the Center...

By Kate Plourd • Sept. 28, 2007

Insider Trading: The SEC’s Friends and Family Project

Continuing its recent crackdown, on Thursday the Securities and Exchange Commission settled two more complaints involving illegal insider-trading schemes. While former SEC complaints charged husband-and-wife teams, the current settlements involve multiple family members and close friends.In one c...

By Stephen Taub • Sept. 28, 2007

Ex–New Mexico Treasurer Sentenced to Prison

Former New Mexico treasurer Michael Montoya was sentenced to 40 months in prison and fined $25,000 for his role in a kickback scheme, the Associated Press reported. Montoya pleaded guilty almost two years ago to a federal racketeering charge as part of an agreement with federal prosecutors in a c...

By Stephen Taub • Sept. 27, 2007

Does the SEC Have the Clout to Rule the Rating Agencies?

During a Wednesday hearing, Securities and Exchange Commission chairman Christopher Cox deflected senators’ concerns that the SEC may not have the authority to intervene if a credit rating agency continually issues false assessments.He reminded the members of the U.S. Senate Committee on Banking,...

By Sarah Johnson • Sept. 27, 2007

Sprint Nextel Loses One, Wins One

Sprint Nextel Corp. said it would pay $57.5 million to settle a class-action lawsuit that stemmed from the 2004 combination of its two tracking stocks. Separately, the company won a $69.5-million patent-infringement verdict over Vonage Holdings Corp. in a Kansas City, Kans., federal-court jury tr...

By Roy Harris and Stephen Taub • Sept. 26, 2007

Fresh Start? SEC Reanoints Rating Agencies

The Securities and Exchange Commission Monday formally returned to seven major credit rating agencies their status as “nationally recognized statistical rating organizations.”That was good news for the rating agencies, still smarting from the criticism heaped on them for being slow to respond to ...

By Tim Reason • Sept. 25, 2007

Hooking Up

Investors look forward to research from Dresdner Kleinwort strategist Albert Edwards as much for its humour as its financial insight. One popular note mixed Edwards’ thoughts on asset allocation with his speed-dating experience, meeting with a group of singles for rapid-fire dates that last for o...

By Jason Karaian • Sept. 24, 2007