Nortel reaches tentative deal on charges

TORONTO, May 16 (UPI) -- Nortel Networks Corp. has reached a tentative settlement with the Ontario Securities Commission over accounting-fraud charges, the regulator said Wednesday.

Canada's main regulator said it would not release details of the settlement, worked out with commission staff, unless its commissioners approve the deal.

The commission set a Tuesday hearing "to consider whether it is in the public interest to approve the settlement" its staff tentatively reached with the Toronto telecommunications-equipment manufacturer, the commission said in a statement.

The OSC alleges Nortel's financial statements in the 2000 fiscal year, the last two quarters of fiscal 2002 and the first two quarters of fiscal 2003 were "materially misleading or untrue" or omitted required facts.

"These practices were undertaken to meet internally imposed pro forma earnings before taxes targets," the commission's statement said.

The OSC is working with the U.S. Securities and Exchange Commission, which in March charged former Nortel Chief Executive Officer Frank Dunn and three other former executives with engaging in accounting fraud from September 2000 through January 2004 to meet earnings projections.