Former software executive faces securities fraud charges
Associated Press
Posted on Tue, Nov. 30, 2004
SAN FRANCISCO - A former executive for antivirus software maker McAfee Inc. has been charged with illegally selling his company stock after learning some of his colleagues had been fabricating sales.
The U.S. Attorney in San Francisco accused Evan Collins of exploiting inside information for his personal gain while he was McAfee's controller in late 2000. The Santa Clara-based company was known as Network Associates Inc. until earlier this year when it changed its name to McAfee - the brand identity of its widely used computer virus-fighting software.
Authorities allege Collins pocketed a $250,000 profit from the sale of 30,000 Network Associates shares after he discovered other insiders were cooking the company's books. Collins decided to sell the stock before the accounting ruse became public knowledge, authorities said.
Collins, 42, pleaded not guilty in San Francisco federal court Tuesday and was released on $500,000 bail. If he is convicted, Collins could face a maximum penalty of 10 years in jail, a $1 million fine and be forced to repay the money that he made from his stock sale.
The federal government has previously charged two other Network Associates executives with criminal conduct in an alleged ruse that forced the company to restate its financial results for the three years ending in 2000.
Prabhat Goyal, Network Associates' former chief financial officer, is fighting a 20-count indictment accusing him of inflating the company's sales to conceal $330 million in losses.
Terry Davis, who replaced Collins as controller, pleaded guilty to securities fraud last year and still awaits sentencing as he cooperates with the government's ongoing investigation.
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