Feeds

L&H subpoeanead by SEC

Accounts sous investigatione

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Speech and language specialist Lernout & Hauspie has been subpoeanaed by the SEC because the agency wishes to investigate its previous years' accounts.

Such an action is more serious than a previous action by the SEC concerning how research in progress was accounted for - a move that the SEC also made against a considerable number of other US companies.

This time the investigation is centred on what are called related party transactions between entities in which the co-chairmen Jo Lernout and Pol Hauspie do or may have an interest, and L&H the company. One example is the enigma of the Brussels Translations Group that was acquired by L&H after it completed a contract to improve Internet machine translation for L&H. It is unusual that the $62 million of goodwill shown on L&H's books is being amortised over 15 years, in view of the speed of development of the technology.

Messrs L&H are adamant that there was no L&H money in the company, and the original shareholders - as the Belgisch Staatsblad of 28 March 1997 makes clear - were Van Deun Consult of Arendonk, Belgium and
Cevennes SA, a company registered in Luxembourg.

A question about the accuracy of L&H's claims for its substantial claims about its Korean sales was raised in a Wall Street Journal article last month.

The worldwide mid-year audit that L&H called for from it auditor KPMG after the allegations is still in progress. L&H said in a statement that it was cooperating fully with the SEC investigation. In addition, L&H's audit committee has initiated an investigation and retained counsel, although whether this is a defensive move or whether defamation actions are contemplated is not known. The criterion for judgement will be whether shareholders have suffered as a result of any relate party transactions. Meanwhile, L&H says it is business as usual.

Marc Cohodes of Rocker Partners, a prominent shorter of L&H stock, is jubilant at the SEC news, claiming it was "game/set/match" and "a total scam here". Last night, L&H's share price closed at $15.125, down $6.125 on the day. ®

Related Stories

L&H returns fire as the class actions roll in
Urbane Bastiaens heads for L&H ambassador role
After Gaston, new L&H CEO focuses on nuts and bolts
Bastiaens bails from L&H
The Reg visits Korea to assess L&H's sales
L&H goes on Korean offensive against WSJ
The trouble with LearnHowTospeak Korean

Secure remote control for conventional and virtual desktops

More from The Register

next story
The Return of BSOD: Does ANYONE trust Microsoft patches?
Sysadmins, you're either fighting fires or seen as incompetents now
China hopes home-grown OS will oust Microsoft
Doesn't much like Apple or Google, either
Linux turns 23 and Linus Torvalds celebrates as only he can
No, not with swearing, but by controlling the release cycle
This is how I set about making a fortune with my own startup
Would you leave your well-paid job to chase your dream?
Microsoft cries UNINSTALL in the wake of Blue Screens of Death™
Cache crash causes contained choloric calamity
Eat up Martha! Microsoft slings handwriting recog into OneNote on Android
Freehand input on non-Windows kit for the first time
Linux kernel devs made to finger their dongles before contributing code
Two-factor auth enabled for Kernel.org repositories
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?