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Nortel Executives Aquited in Accounting Fraud Case
Published on:
Three executives at Canada's bankrupt Nortel Networks have been found not-guilty of allegations of financial fraud in their financial statements prior to the company declaring bankruptcy.
The court dismissed the charges against former CEO, Frank Dunn, CFO Douglas Beatty and financial controller, Michael Gollogly after finding that the prosecution had failed to meet the required level of proof that a crime was committed.
The charges had carried a potential maximum jail sentence of up to 14 years.
"I am not satisfied beyond a reasonable doubt that Frank A. Dunn, Douglas C. Beatty and Michael J. Gollogly deliberately misrepresented the financial results of Nortel Networks Corporation," Justice Marrocco said in his ruling.
The case was based on allegations about how the company accounted for reserves in its accounts usually set aside to cover future contingencies. It was claimed that the company downsized its liabilities in order to over value the worth of the reserves to bolster the headline profit figures.
The company was later forced to make a number of accounting corrections going back several years, and eventually filed for bankruptcy.
In a statement, Dunn's lawyer, praised the verdict "This acquittal represents a complete vindication for Frank Dunn, and a well-reasoned rejection of the Crown's allegations. We are very pleased with this decision,"
Tags: [nortel networks] [Canada]
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