Feeds

SEC charges eight ex-AOL TW execs with civil fraud

Inflating ad revenues

SANS - Survey on application security programs

For two years, between 2000 and 2002, AOL execs cooked the books, bigtime.

They inflated revenues by more than $1bn, through artificial barter deals, by booking one-time gains as advertising income, and by booking the entire gross amount of advertising contracts instead of just the commission element. The Washington Post exposed the con in mid-2002. The US Securities and Exchange Commission (SEC) then went to work.

In 2005, Time Warner, AOL's parent company, got itself off the hook by paying the SEC $300m to settle securities fraud charges.

Now the SEC is gunning for the AOL Time Warner execs said to be involved in the advertising monkeyshines.

Today, it filed civil fraud charges against eight ex-execs. It has divided them into two groups of four: those it has let settle, and those it is pursuing through the court. Headed for a New York courtroom are John Kelly, former CFO of AOL Time Warner; Steven Rindner, a former exec in the company's business affairs Unit; Joseph Ripp, former CFO of the AOL division; and Mark Wovsaniker, former head of Accounting Policy.

According to the SEC, they "engineered, oversaw, and executed fraudulent round-trip transactions in which AOL Time Warner effectively funded its own advertising revenue by giving purchasers the money to buy online advertising that they did not want or need. Online advertising revenue was a key measure by which analysts and investors evaluated the company".

The four who have settled are all former employees in AOL's business affairs unit. They are not admitting or denying the SEC allegations, but they are collectively paying fines and penalties of more than $8m.

More at the SEC. ®

High performance access to file storage

More from The Register

next story
Sorry London, Europe's top tech city is Munich
New 'Atlas of ICT Activity' finds innovation isn't happening at Silicon Roundabout
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
prev story

Whitepapers

Designing a defence for mobile apps
In this whitepaper learn the various considerations for defending mobile applications; from the mobile application architecture itself to the myriad testing technologies needed to properly assess mobile applications risk.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.