Feds: Ex-Symbol Exec Inflated Earnings
CENTRAL ISLIP, N.Y. (AP) _ A former Symbol Technologies executive pleaded guilty in federal court Tuesday to charges that he participated in a scheme to inflate quarterly and annual revenues and earnings to make sure the company met Wall Street estimates.
``I knew what I was doing was wrong,″ Robert Asti told U.S. District Court Judge Leonard D. Wexler. ``I am sincerely sorry for my actions.″
A 14-page indictment accused Asti and other unidentified Symbol executives of recording at least $10 million in false sales between 1999 and 2001 to make sure the company met its estimates. Asti pleaded guilty to both securities fraud and conspiracy to commit securities fraud.
The company, based in Holtsville, makes laser bar code scanners seen in most supermarkets, hand-held computers and wireless communications networks for voice and data. It reported revenues in 2001 of approximately $1.45 billion.
Asti, 44, served as vice president of finance and operations for the Americas, as well as vice president of worldwide sales and finance, until his resignation in March 2001.
Among the deceptive practices prosecutors say Asti engineered was ``channel stuffing″ _ selling more product to a customer than the customer needed, then buying back the excess and recording the entire transaction as revenue.
``He knew it was wrong ... that’s why he walked away from the company,″ Asti’s attorney, Paul Shechtman, said outside the courtroom. ``If you talk to people at Symbol, you’ll learn he was not happy about this scheme and he let people know it.″
Shechtman said that after Asti quit the company, he drove a bread delivery truck for about a year before going into private business.
He said Asti has ``cooperated fully″ with investigators and added there was no deal with prosecutors in exchange for the guilty plea or cooperation. Asti faces 10 years on the fraud charge and five years in prison on the conspiracy charge; Wexler also has the option of ordering that the sentences run consecutively.
The judge did not immediately set a sentencing date.
The Securities and Exchange Commission also filed a civil suit in Brooklyn federal court Tuesday spelling out many of the same accusations and alleging that Asti violated federal securities laws. Shechtman said he is working on a similar settlement Asti’s behalf with the SEC.
The SEC is also investigating the company.
Richard Bravman, Symbol vice chairman and chief executive officer, said in a statement posted on the company’s Web site that it ``continues to work with its auditors to complete a restatement of earlier financial results, and we anticipate the amount and timing of this restatement to be consistent with the company’s previous disclosures.″
He added that Symbol is cooperating with ongoing investigations by both the SEC and federal prosecutors.
Trading in Symbol’s shares was halted briefly Tuesday on the New York Stock Exchange before they closed at $9.48 each, up 3 cents.