Rambler's Top100
Все новости World News

Eight ex-AOL executives charged with fraud

20 мая 2008

US regulators on Monday announced fraud charges stemming indirectly from the merger of Time Warner and AOL, the largest union in US corporate history and a symbol of the dotcom boom and bust of the early part of this decade.

Eight former executives of the merged group were accused by the Securities and Exchange Commission of participating in a scheme to inflate internet advertising revenues at the merged AOL Time Warner by more than $1bn. The civil charges stem from claims that the eight artificially inflated online advertising as the dotcom boom evaporated, sustaining the internet company’s returns in the months leading up to and after the deal with Time Warner. The allegedly inflated earnings came at a time when investors, souring on the outlook for internet companies, were starting to question the wisdom of the merger, which handed AOL shareholders control of the more established traditional media group.

The charges, which include a complaint against John Michael Kelly, the former AOL chief financial officer who went on to hold the same position at the enlarged AOL Time Warner, are the first levelled against individuals over the affair.

The company itself agreed to a $300m settlement in 2005 to settle related charges. Four individuals, including Mr Kelly, will contest the charges filed on Monday. In a separate lawsuit, four others settled charges with the SEC by agreeing to pay a total of more than $8m, while neither admitting nor denying wrongdoing.

The SEC said on Monday that when the Time Warner merger was pending in mid-2000, AOL faced a growing crisis with regard to its advertising revenue as the market for online advertising began to shrink.

In response, the SEC claims, the defendants participated in a scheme that led the company to inflate its advertising revenue through a series of “round-trip” transactions in which AOL “effectively funded its own advertising revenue by giving its counterparties the means to purchase AOL online advertising that the counterparties did not need or want”.

In addition to Mr Kelly, Steven E. Rindner, former senior executive in the company’s business affairs unit, Joseph A. Ripp, former chief financial officer of the AOL division, and Mark Wovsaniker, former head of accounting policy, are contesting fraud-related charges.

Источник: Financial Times

Заметили неточность или опечатку в тексте? Выделите её мышкой и нажмите: Ctrl + Enter. Спасибо!

Оставить свой комментарий:

Для комментирования необходимо авторизоваться!

Комментарии по материалу

Данный материал еще не комментировался.