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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: RDM who wrote (79320)	11/10/1999 11:37:00 PM
From: Process Boy	Respond to of 1573683

RDM and Thread - AMD Distributor Future Corp. charged with defrauding AMD, and others, to the tune of tens of millions of dollars a year ebnews.com U.S. charges Future defrauded top chip makers By Matthew Sheerin Electronic Buyers' News (11/10/99, 08:13:15 PM EDT) The U.S. Department of Justice alleges that Future Electronics Corp. has defrauded Advanced Micro Devices Inc., Texas Instruments Inc., Motorola Inc., and other component suppliers by keeping two sets of books and falsely reporting the amount of products it actually sold, according to documents unsealed by a Canadian court on Wednesday. The documents were part of an affidavit filed with the Central Authority of Canada last spring to request a warrant to search Future's headquarters in Pointe Claire, Quebec. The affidavit charges that Future founder and chairman Robert Miller acted in concert with several top employees to defraud U.S.-based companies. Future released a long statement defending its business practices, and called the allegations "wholly unfounded and distorted." The distributor said it will "vigorously contest any allegations of wrongdoing and will be vindicated." The search of Future's headquarters took place last May, but no formal charges have yet been filed. The Justice Dept. claims in the affidavit that Miller and other Future employees, who were part of an exclusive group known as the "A-Team," defrauded certain component suppliers by keeping two sets of books. "One represents [Future's] actual sales activities and inventory levels; the second is a falsified version of the same information that is used in reports submitted to [Future's] vendors," the Justice Dept. alleges in the documents. Miller and certain associates manipulated two main reports that Future submits to suppliers: a point-of-sales (POS) report, and an Inventory Position Report, according to the charges in the affidavit. As a result, the affidavit continued, the manipulated sales and inventory figures result in "significantly increased profits for [Future] and multimillion-dollar losses to its vendors, including Motorola and Texas Instruments." The Justice Dept. estimated that AMD, Motorola and TI "are losing approximately $100 million a year due to the fraudulent activities." In its statement, Future said: "Many of the assertions of the affidavit reflect a fundamental misunderstanding of the industry's commercial and accounting practices. Moreover, some of the company's terminology, which the affidavit treats as sinister, reflects nothing more than the company's shorthand for routine legitimate practices." The distributor added that "the amount of the alleged fraudulent ship from stock and debit transactions-which is the central allegation of the affidavit-well exceeds the entire amount of all ship from stock and debit transactions conducted by Future during the relevant years. No such accusations against a reputable company should be based on such an obvious inaccuracy." Future also claimed that "the affidavit appears to be based on assertions by disgruntled former employees and one particularly hostile competitor," although it did not disclose the identities of either of the parties. The release of the documents comes six months after more than 30 Royal Canadian Mounted Police officials and one FBI agent entered Future's headquarters and conducted a search during which approximately 80 boxes of files and computer equipment were removed. The release of the documents came just minutes after ON Semiconductor, one of Future's biggest suppliers, confirmed that it had cut the company from its distribution roster