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Biotech / Medical : PLSIA (Premier Laser Systems)

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To: Westergaard who wrote (1749)	12/19/2002 3:00:21 PM
From: StockDung	of 1773

.12/19 14:43 U.S. Technologies CEO Charged With Investor Fraud (Update2) By William McQuillen New York, Dec. 19 (Bloomberg) -- U.S. Technologies Inc. Chief Executive Officer C. Gregory Earls was charged in a $13.8 million investor fraud linked to a scandal that contributed to Harvey Pitt's resignation as chairman of the Securities and Exchange Commission. Pitt resigned last month after failing to reveal that former FBI director William Webster, chosen as chairman of a new federal accounting oversight board, had led the U.S. Technologies audit committee. The company was the subject of a fraud suit by shareholders. Webster later stepped down from the panel. Earls falsely represented that investments in USV Partners would be used to capitalize and buy U.S. Technologies securities, according to a criminal complaint unsealed today by the U.S. Attorney's office in Manhattan. ``There is probable cause to believe that Earls well knew those representations were false,'' the complaint says. He's also accused in court papers of taking about $13.8 million of the $20 million he raised from investors and diverting it to an educational trust for his children, investors in other failed ventures, and his ex-wife. Earls is charged with securities fraud, mail fraud and wire fraud. Fired Auditor Webster resigned Nov. 12 as head of a new panel created by Congress to discipline accountants and oversee audits following scandals at Enron Corp., WorldCom Inc. and other companies. During his tenure as chairman of the U.S. Technologies audit committee, an outside auditor who criticized the company's lack of financial controls was fired. U.S. Technologies later faced a shareholder lawsuit for fraud. Webster disclosed that suit to Pitt after his appointment to lead the new accounting board, though Pitt failed to inform fellow SEC commissioners. Pitt resigned under heavy criticism for not telling the White House about the shareholder suit against U.S. Technologies. The controversy also led to the resignation of the SEC's chief accountant, Robert Herdman.

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