Gen Re, AIG Execs Indicted

Four former senior executives of General Re—including its former chief financial officer–and one former senior executive of American International Group were indicted for their participation in a fraudulent scheme to manipulate AIG’s financial statements.The announcement was made on Wednesday by ...

By Stephen Taub • Sept. 20, 2006

Creditors Can Sue Dead Enron Exec

A judge has ruled that the estate of a former Enron executive who committed suicide is fair game for creditors.U.S. Bankruptcy Judge Arthur Gonzalez said in a recent ruling that the creditors can try to recover $1.3 million from the family of former Vice Chairman Cliff Baxter, who died of a self-...

By Stephen Taub • Sept. 20, 2006

Former Ahold CFO Pleads Guilty

The former chief financial officer of U.S. Foodservice Inc, a unit of Royal Ahold NV, pleaded guilty earlier this month for his role in the Dutch retailer’s financial scandal several years ago, according to the Associated Press.Michael Resnick will face up to five years in prison when he is sente...

By Stephen Taub • Sept. 19, 2006

Former Enron ES Exec Sent to Prison

Another former Enron executive is headed to prison.David Delainey, who ran the company’s retail energy unit, Enron Energy Services, was sentenced to two and a half years in prison after previously pleading guilty to insider trading, said the Associated Press. Before joining EES, Delainey ran Enro...

By Stephen Taub • Sept. 18, 2006

Former Willbros Boss Admits Bribery

A former employee of Willbros Group, an energy-services company, has reportedly pleaded guilty to violating antibribery provisions of the Foreign Corrupt Practices Act and has agreed to settle charges against him by the Securities and Exchange Commission.On Thursday, the Department of Justice sai...

By Stephen Taub • Sept. 15, 2006

Former Enron Finance Exec Avoids Prison

A former Enron assistant treasurer has escaped a potential prison sentence for his role in the onetime energy giant’s fraud. Timothy DeSpain, who pleaded guilty nearly two years ago to conspiracy to commit securities fraud, was sentenced to four years of probation and a $10,000 fine, according to...

By Stephen Taub • Sept. 15, 2006

Senator Takes on DoJ’s Thompson Memo

Sen. Arlen Specter (R-Pa.) plans to introduce legislation that would prevent federal prosecutors from encouraging companies to cut off attorney fees or to waive their attorney-client privilege in corporate criminal cases, according to several sources.Specter made this announcement during a contin...

By Sarah Johnson • Sept. 14, 2006

Breeden To Oversee Adelphia Payout

Former Securities and Exchange Commission Chairman Richard Breeden has been hired to administer the process of compensating the victims of Adelphia Communications’ fraud, according to an announcement made by Michael Garcia, the United States Attorney for the Southern District of New York.In April...

By Stephen Taub • Sept. 14, 2006

More Shareholders Back Green Schemes

Social issues are gaining ground among the governance set.More than one-quarter of the 179 social policy proposals voted on by shareholders this year received at least 20 percent support, according to data compiled through August 2006 by Proxy Governance Inc. This compares with just 12 percent of...

By Marie Leone • Sept. 13, 2006

Former HealthSouth CFO Gets Three Years

A federal judge has sentenced former HealthSouth CFO Michael Martin to 36 months in prison, according to Reuters. It was the third time Martin has been sentenced for his role in the company’s $2.7 billion accounting scandal. The first time around, when he was sentenced to five months probation...

By Stephen Taub • Sept. 12, 2006

Senate Urged to Fix Thompson Memo

At a Senate Judiciary Committee hearing Tuesday, witnesses ranging from corporate attorneys to U.S. Chamber of Commerce president Tom Donohue urged lawmakers to take action against the provisions of the Department of Justice’s so-called Thompson Memorandum.Written in 2003, the DoJ memo says that ...

By Sarah Johnson • Sept. 12, 2006

Freddie Mac Thinks DOJ Probe’s Over

Freddie Mac says it thinks that the Justice Department is no longer investigating the company and the issues related to its massive accounting scandal, according to press reports.Company spokesman David Palombi told the Washington Post that the U.S. attorney’s office hasn’t contacted the company...

By Stephen Taub • Sept. 12, 2006

CEO Not a College Grad, R.H. Donnelley Says

R.H. Donnelley confirmed that two press releases regarding the background of chief executive officer David C. Swanson incorrectly described Swanson’s education.The publisher of the yellow pages said Swanson did attend St. Cloud State University, from 1973 to 1976, but he did not earn a degree.The...

By Stephen Taub • Sept. 11, 2006

Ex-CFO Helps Healthsouth Fight Scrushy

A former finance chief for HealthSouth is helping the company fight former CEO Richard Scrushy’s claims against the company for $35 million in legal fees, according to The Birmingham News, citing court filings.Mike Martin, who on Tuesday will be resentenced for his role in HealthSouth’s massive a...

By Stephen Taub • Sept. 11, 2006

Judge Dismisses Suit Against Visteon

A federal judge has dismissed a lawsuit against Visteon and four current and former executives, including two finance executives, according to Bloomberg News.Visteon was sued in February 2005 after it restated earnings. Shareholders alleged that certain company executives failed to disclose the r...

By Stephen Taub • Sept. 8, 2006

Judge Okays Time Warner Settlements

Time Warner’s accounting scandal seems to be receding further into the past. A federal judge has approved settlements of a number of derivative lawsuits based on alleged accounting misconduct before and after the media giant’s ill-fated 2001merger with America Online Inc., according to Dow Jones ...

By Stephen Taub • Sept. 7, 2006

SEC Launches Probe of XM Satellite

XM Satellite Radio Holdings Inc. said the Securities and Exchange Commission has launched an informal, inquiry into the company’s past financial disclosures.The company said that on Aug. 31, the SEC requested documents regarding its subscriber targets, costs associated with attempting to reach th...

By Stephen Taub • Sept. 6, 2006

SEC Supports PCAOB in Lawsuit Defense

The Securities and Exchange Commission late Friday announced that it has joined a U.S. Department of Justice legal brief in support of the Public Company Accounting’ Oversight Board defense against a lawsuit challenging the PCAOB’s constitutionality.Filed in February, the lawsuit led by the Free ...

By Stephen Taub • Sept. 5, 2006

SEC Settles Stock Sale Case with Ex-CFO

The Securities and Exchange Commission settled an insider trading complaint yesterday against Stewart P. “Tom” Mitchell, former CFO of Ferguson Enterprises, one of the largest distributors of heating and cooling equipment in the U.S.The SEC had alleged that Mitchell was using material nonpublic i...

By Sarah Johnson • Aug. 31, 2006

Who’s Controlling the Controller?

One of the greatest sources of controversy in the business world in recent months has been whether small public companies are capable of maintaining the level of internal controls prescribed by section 404 of the Sarbanes-Oxley Act.But even as that debate rages on, say experts, private companies ...

By Helen Shaw • Aug. 28, 2006

Study: Supplier Diversity Doesn’t Cost More

Companies wanting to expand their supplier diversity programs can do so without sacrificing savings, according to a recent report by The Hackett Group.While many executives may assume that proactive efforts to use women-or minority-owned suppliers result in higher costs or additional administrati...

By Sarah Johnson • Aug. 24, 2006

Lessons Learned

Until Katrina, many Gulf Coast businesses thought their disaster-recovery plans were pretty solid. As the first anniversary of the hurricane approaches, some of those companies have renovated the old plans or built new ones.Like other companies in the storm’s path, New Orleans–based Entergy has s...

By Allan Richter • Aug. 24, 2006

IMAX, Former CFO, and Others Sued

A class-action lawsuit has been filed against IMAX Corp., its former CFO, and two other executives alleging that they made “false and misleading statements” about the company’s financial health. The suit, at least the second one filed in the past week against the movie-theater company, charges th...

By Stephen Taub • Aug. 22, 2006

Shareholders Seek Political Spending Receipt

With almost all of the results from the 2006 proxy season in, it is clear that some shareholders have their eyes on another season: the coming November elections.Indeed, the number and sophistication of shareholder resolutions related to corporate political contributions continues to rise. “The g...

By Helen Shaw • Aug. 22, 2006

Former Church CFO Indicted by FBI

A former treasurer and CFO of the Roman Catholic Diocese of Cleveland was indicted by the Federal Bureau of Investigation last week for an alleged kickback scheme totaling $784,000, according to an FBI statement.Joseph F. Smith, the former Cleveland finance chief who is now finance director of th...

By Marie Leone • Aug. 21, 2006