NEW YORK, March 12 (UPI) -- U.S. securities regulators Monday charged Nortel Networks' former Chief Executive Frank Dunn with cheating investors out of billions of dollars.
Dunn and three other former executives conspired to engage in repeated "accounting fraud to bridge gaps between Nortel's true performance, its internal targets and Wall Street expectations" between September 2000 and January 2004, the Securities and Exchange Commission alleged in a New York court filing.
The three other executives are former Controller and Chief Financial Officer Douglas Beatty, former Controller Michael Gollogly and Assistant Controller and corporate reporting Vice President MaryAnne Pahapill, the complaint said.
The Toronto telecommunications-equipment executives sought to "create the false appearance" Nortel had returned to profitability after three years of red ink so they could pay bonuses to themselves and other employees, the complaint alleged.
"Dunn, in particular, made known his lack of respect for Nortel's control organization, which he saw as an impediment to the company's ability to do business quickly," the SEC complaint said.
The SEC charges were laid the same day the Ontario Securities Commission announced a formal hearing into financial-misconduct and negligence allegations against Dunn, Beatty and Gollogly. The commission did not name Pahapill.
