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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: ProDeath who wrote (56019)	5/10/2000 6:38:00 PM
From: StockDung	Read Replies (1) \| Respond to of 122087

Judge Orders `Crazy Eddie' Relatives to Pay $72.7 Mln Washington, May 10 (Bloomberg) -- Two former Crazy Eddie Inc. executives and a distributor who sold records to the defunct New York-area discount electronics chain have been ordered to pay $72.7 million in an insider trading case. A New Jersey federal judge found Sam M. Antar, 78, a co- founder of the chain, liable for $57.5 million in allegedly ill- gotten gains and interest, the Securities and Exchange Commission said. Sam Antar is the father of Eddie Antar, whose nickname ``Crazy Eddie'' gave the chain its name. U.S. District Judge Harold A. Ackerman found Allen Antar, 50, Eddie Antar's brother and the chain's former director of corporate sales, liable for $11.9 million, the SEC said. Record distributor Benjamin Kuszer, 50, who also was Eddie Antar's brother-in-law, has been ordered to pay $3.3 million, the agency said. In 1993, the SEC alleged that the two Antars and Kuszer sold Crazy Eddie stock while possessing inside information about massive fraud at the retailer, which advertised electronics goods priced low enough to be ``insane.'' The company's false financial statements propelled its stock to $79 a share by 1986 from its initial public offering price of $8 a share in 1984, the SEC charged. In a 1998 ruling, Ackerman agreed. He found that the three men ``engaged in an extensive, multifaceted fraud which consisted of cash skimming, falsification of inventory counts and the inflation of sales figures of certain key stores.'' The judge said, ``the defendants, having artificially and fraudulently inflated the price of the stock, then sold their substantial stockholdings to an unwitting public for an enormous profit.'' The amounts Ackerman ordered the three men to pay were based on a hearing in which the commission presented expert testimony on what the value of Crazy Eddie stock would have been if the public had known of the defendants' alleged frauds. ``As innovative as it was, the core of Crazy Eddie was rotten, and the investing public, once it became aware of that fact would, not have dawdled in ridding itself of the stock,'' Ackerman said. Lawyer Bruce Goldstein, who represented Sam and Allen Antar in the civil action, declined to comment. Kuszer's lawyer couldn't be reached. The largest insider-trading penalty against a chief executive in recent years was the $77.5 million paid by ``Crazy Eddie'' Antar himself between 1994 and 1997, according to the SEC. Eddie Antar was charged with overstating the income of his discount store so he and his family could sell their shares at a profit. Antar, a fugitive who was arrested in Israel, was sentenced to six years and 10 months in prison. He no longer is in prison, said Richard Simpson, an SEC assistant chief litigation counsel. ``One of the last remaining obstacles in this case is that in the months before the trial, Sam, the father, transferred all of his valuable real estate to his wife,'' Simpson said. ``We're trying to untangle those transactions and recover the properties to enforce the judgment.'' Sam and Allen Antar live in West End, New Jersey, Simpson said. Kuszer is a resident of Brooklyn, N.Y. Ackerman also ordered three of Allen Antar's children -- Rori Antar, Sam A. Antar, and Michelle Antar -- to give up $425,000 each in connection with trades in Crazy Eddie stock that Eddie Antar made on their behalf in March 1985. The children were not accused of any wrongdoing. May/10/2000 18:23 GMT For more stories from Bloomberg News, click here. (C) Copyright 2000 Bloomberg L.P.