SEC bars ex-Systemax veep from director role in fraud deal
Gilbert Fiorentino settles with fine of $65,000
The SEC has barred former Systemax veep Gilbert Fiorentino from being a director of a PLC again after finding he "fraudulently" pocketed hundreds of thousands of dollars in compensation over five years.
The disgraced exec, who had been CEO of the reseller's Technology Products Group, was put on administrative leave in April 2011 amid whistleblower allegations relating to the Florida operation.
An investigation was launched by the SEC last June and Fiorentino resigned, handing back stock and stock options valued at $9.1m, and repaying his annual bonus of $480,000 for 2010.
The SEC alleged last night the exec had banked $400,000 in additional compensation from firms that did business with Systemax between January 2006 and December 2010.
The federal agency also claimed he stole $200,000 worth of company merchandise used to market the reseller's products.
Fiorentino had organised the extra payments when dealing directly with "external service providers, manufacturer representatives, and others that conducted business with Systemax," said the SEC.
The SEC also claimed the fallen exec had bagged $5,000 to $10,000 a month from a firm that supplied materials to Systemax's retail and mail order operations, as just one example of why actiuon was taken againsst him.
As Fiorentino was one of the firm's highest paid execs, he was duty-bound under SEC regulations to disclose all compensation, perks and other personal benefits he received on a yearly basis.
He apparently failed to disclose these payments – meaning the amounts reported by Systemax to shareholders were understated.
Fiorentino has agreed to settle the charges, paying a $65,000 penalty, consenting to a "permanent bar" from serving as an officer or director of any publicly held firm, and agreeing to a permanent injunction from further violations of the anti-fraud and other provisions of the federal securities laws.
"Fiorentio brazenly stole from Systemax and betrayed the trust of its shareholders," said Eric I Bustillo, director of the SEC's Miami regional office.
"His actions demonstrate that he is unfit to serve as an officer or director of a public company," Bustillo added. ®