Former Gateway CFO denies fraud charges

Former Gateway chief financial officer John Todd has denied charges of fraud brought against him by the US Securities and...

Former Gateway chief financial officer John Todd has denied charges of fraud brought against him by the US Securities and Exchange Commission.

Last week, the SEC filed suit against Todd as well as former Gateway chief executive officer Jeffrey Weitzen and former Gateway controller Robert Manza.

"This suit is wrong and should never have been authorised," said attorney Robert Rose of Sheppard, Mullin, Richter & Hampton in a statement on behalf of Todd. The former CFO did nothing to hurt Gateway or its shareholders, but improved controls at Gateway, the statement claimed.

Todd's response through his attorney is similar to one that ex-CEO Weitzen issued on Thursday through his attorney. Both former Gateway executives have accused the SEC of going too far in pursuing white-collar crime in corporate America and expect to be exonerated in court.

The SEC has "lost its fairness and balance," Rose said.

The lawsuits against the individual former executives and a settlement with Gateway are the result of an investigation into Gateway that the SEC began in December 2000.

Gateway, without admitting or denying any wrongdoing, has agreed to an order prohibiting it from any future violations of US securities laws.

The company replaced its top management in early 2001 and has restated its financial results for the second and third quarters of 2000, the periods in which the alleged fraud took place.

Joris Evers writes for IDG News Service

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