Ex-Vitesse Semiconductor Executives Charged With Securites Fraud
Dec 10th 2010 4:46PM
Updated Dec 10th 2010 6:28PM
Two former executives with Camarillo, Calif.-based Vitesse Semiconductor (VTSS) were charged with securities fraud a week after the company's financial chief pled guilty to similar charges.
Louis Tomasetta, the 62-year-old founder and former CEO of Vitesse, and Eugene Hovanec, the 60-year-old former executive vice president of the company, allegedly falsified accounting entries to manipulate Vitesse's financial statements, the U.S. Attorney's Office of New York's Southern District said in a statement Friday.
Tomasetta, Hovanec and other executives alledely plotted to misled investors, auditors and other entities by improperly accounting for revenue, returned product and accounts receivable items in order to falsely overstate the company's sales and profit figures, according to the Attorneys office.
The defendants also filed false reports for the fiscal year ended Sept. 30, 2005, and for the quarter ended Feb. 8, 2008. Additionally, the executives also back-dated stock options to give the executives an exercise price that was less than market value.
The stock was de-listed from the Nasdaq in June 2006, two months after Vitesse announced an internal investigation.
On Dec. 3, Yatin Mody, Vitesse's former CFO, pled guilty to securities fraud, the Attorneys Office said. On Nov. 30, Nicole Kaplan, the company's former director of accounting, also pled guilty to securites fraud.
Both Mody and Kaplan face a maximum term of 45 years in prison, and a fine of either $5 million or twice the amount they profited from the actions they were charged for.