Symbol Technologies Inc. announced last month that the chairman and the firm’s general counsel have resigned.
The resignations are the latest woes to hit the wireless LAN vendor, which faces continued scrutiny from the U.S. Securities and Exchange Commission and the U.S. Attorneys Office for accounting scandals and fraud allegations that have resulted in two former top executives pleading guilty.
Symbol announced the resignation of cofounder and chairman Jerome Swartz, and of Leonard Goldner, the beleaguered company’s general counsel. CEO Richard Bravman, also board vice-chairman, will take over the chairman’s post temporarily.
Symbol also announced it was planning to restate earnings in the later half of July, instead of in late June as originally intended. The restatement will come in the 2002 annual report. By mid-August, Symbol will also file with the SEC the first- and second-quarter earnings statements.
In a company press release, Swartz acknowledges, “It is clear that improper finance and accounting activities occurred at Symbol Technologies during my tenure.”
Those “activities” have caught a lot of official attention. The SEC and the U.S. Attorney’s office are both continuing their investigations. The company says it’s finalizing its own internal review.
The probes have already had results. Two former executives have pleaded guilty to federal fraud charges, filed by the Department of Justice’s U.S. Attorneys Office. The controversy also has sparked several shareholder lawsuits against Symbol.
In June, former chief accounting officer Robert Korkuc pled guilty to fraud and conspiracy charges related to a scheme to inflate revenues between 1998 through 2002. Last March, former financing sales executive Robert Asti pled guilty to federal fraud charges. He used fraudulent accounting practices to inflate sales, by over US$100 million, according to the SEC. The SEC also filed civil charges against Asti, charging him with violating a batch of federal securities laws. The SEC has filed civil charges against both men, alleging violations of federal securities laws.
Symbol’s stock price has been creeping upwards since September 2002, when it plummeted to US$4.98 per share, its lowest price in at least two years. It topped out at US$14.93 per share in mid-June. It’s fallen slightly to between US$13 and US$14 per share.