2TheMart's Top Executives Resign After Auditors Quit
Irvine, California, March 29 (Bloomberg) -- 2TheMart.com's top two executives quit after its outside auditor resigned, citing a loss of confidence in management and a lack of adequate internal controls and management oversight.
Dominic Magliarditi stepped down as president, chief operating officer and chief financial officer and Steven Rebeil quit as chief executive but remain as co-chairman.
Grant Thornton LLP, the outside auditor, informed the company of its resignation a week ago, on March 22, the company said in a filing with the Securities and Exchange Commission.
2TheMart said Grant Thornton explained it would 'no longer be able to rely on management's representations.' It added that Grant Thornton also said it ``does not have adequate internal controls or the appropriate level of management or board oversight'
In July, the company's first auditor, Deloitte & Touche LLP ended its relationship with 2TheMart a month after it was hired.
Separately, 2TheMart said it agreed to buy Orange, California- based GoToWorld.com Inc., an Internet Site that pays members to Web surf and shop, for an unspecified amount of stock.
GoToWorld, which began operations last year, said it gets about 10 million unique visitors per month and has 2 million registered users. A GoToWorld spokesman declined to provide earnings or revenue information. He said GotoWorld's Site was down today because of unusually heavy traffic.
2TheMart said Ian Simpson, GoToWorld's chief executive, would become president, chief executive and co-chairman of 2TheMart.
With just two days remaining before the company's deadline to file its 1999 audited financial statements with the Securities and Exchange Commission, Corbin & Wertz, LLP was hired to replace Grant Thornton to conduct the audit.
The company said the resignations of Grant Thornton and the executives weren't related.
Three years ago, the Nevada Gaming Commission denied a gaming license application submitted by Magliarditi and Rebeil. It found they lied to state investigators and weren't qualified to be officers or directors of a publicly traded company.
2TheMart gained 1/16 to 4 15/16 on trading of 98,800 shares.
Mar/29/2000 21:33
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