Cuc cendant corporation fraudulent financial reporting

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Cuc cendant corporation fraudulent financial reporting

Kirk Shelton, Civil Action No. The Commission, among other relief, seeks disgorgement of their fraudulent stock gains with prejudgment interestpayment of civil money penalties, orders barring Forbes or Shelton from serving as an officer of a public company, and injunctions against violations of the federal securities laws.

Litigation Release No. / February 28,

The litigation results from the Commission's investigation of a long-running financial fraud that began at CUC in the s and continued until its discovery and disclosure by Cendant in April Upon disclosure of the fraud, the price of Cendant common stock plummeted, causing billions of dollars in losses for investors.

Walker said, "As this case graphically illustrates, large, complex, and long-running financial frauds often originate at the highest levels of a company. When senior officers entrusted by investors to run public companies engage in fraud, the Commission will respond aggressively to assure continued investor confidence in the quality of financial reporting.

Cuc cendant corporation fraudulent financial reporting

Forbes and Shelton reviewed and managed schedules listing fraudulent adjustments to be made to CUC's quarterly and annual financial statements.

CUC senior management used the adjustments to artificially pump up income and earnings, defrauding investors by creating the illusion of a company that had ever-increasing earnings and making millions for themselves along the way.

Forbes and Shelton undertook a program of mergers and acquisitions on behalf of CUC in order to generate inflated merger and purchase reserves at CUC to be used in connection with the fraud.

Forbes and Shelton sought out HFS as a merger partner because they believed the reserves that would be created would be big enough to bury the fraud.

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Soon after CUC merged with HFS to create Cendant, Forbes and Shelton explicitly congratulated each other on being masterful "financial engineers" who had been able to nurture the fraud through the years and who had assured their continued success by duping HFS into agreeing to a merger with CUC.

Forbes and Shelton profited from their own wrongdoing by selling CUC and Cendant securities at inflated prices while the fraud they had directed was underway and undisclosed.

The sales brought Forbes and Shelton millions of dollars in ill-gotten gains. At the time of the merger, Shelton became a Cendant director and Vice Chairman. Shelton resigned from Cendant in April The Commission seeks to enjoin Forbes and Shelton from violating Section 17 a of the Securities Act, Sections 10 b13 a13 b and 14 a of the Exchange Act and Rules 10b-5, 12b, 13a-1, 13a, 13b, 13b, and 14a In addition, as noted above, the Commission seeks disgorgement of their fraudulent stock gains, prejudgment interest, civil money penalties and orders barring Forbes and Shelton from serving as an officer and director of a public company.

The Commission previously brought related civil actions and administrative proceedings against seven individuals, as well as against the issuer. See Litigation Release No.

These actions remain pending as to Cosmo Corigliano and Ann Pember.

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The Commission acknowledges the assistance provided by the U. Attorney for the District of New Jersey. The Commission's investigation in this matter is continuing.Background on Cendant Corporation and its Accounting fraud.

Cuc cendant corporation fraudulent financial reporting

How the financial fraud was detected. Remedies implemented after detection. Possible remedies to prevent a recurrence. Whistle blowers, Casper Sabatino former vice president of accounting and financial reporting and steven Speaks vice.

Former executives plead guilty in Cendant case - Jun. 14, Fraudulent Financial Reporting Author:
Cedant Corporation: the merger of CUC AND HFS by Patricia Chavez on Prezi ResearchEstimatesthe franchiser of brand names such as Ramada hotels and Avis rental cars, is now based in New York.
LITIGATION RELEASE NO. / June 14, Cosmo Corigliano, Anne M.
Kirk Shelton, Civil Action No.
Cedant Corporation: the merger of CUC AND HFS by Patricia Chavez on Prezi Cosmo Corigliano, Anne M.

The litigation results from the Commission's investigation of a long-running financial fraud that began at CUC in the s and continued until its discovery and disclosure by Cendant in April Upon disclosure of the fraud, the price of Cendant common stock plummeted, causing billions of dollars in losses for investors.

The Commission's complaint alleges that Kearney, a former CUC Director of Financial Reporting, also instructed lower-level CUC financial reporting managers to carry out directives received from Corigliano in furtherance of the fraud.

CUC Cendant Corporation: Fraudulent Financial Reporting | iridis-photo-restoration.com

Cendant Corporation was a consumer services conglomerate formed in December by a $14 billion merger between two companies — HFS Inc.

and CUC International. The merger combined the travel and hotel holdings of HFS with CUC’s direct marketing business. sec charges walter a. forbes and e. kirk shelton, former top officers of cuc international inc., and cendant corp., with directing and profiting from a massive financial fraud.

Fraudulent of financial reporting or misappropriation of assets will arise fraud misstatement where fraudulent shown in the financial statement misstatements or omissions that deceive users and for misappropriation of assets is referring to the thefts of entity assets reported in financial statement.

Litigation Release No. / February 28,