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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: RockyBalboa who wrote (11234)	3/11/2003 8:03:14 AM
From: StockDung	Respond to of 19428

TISSUE EXECS BLEW $300M By KATI CORNELL SMITH March 11, 2003 -- Former top executives at American Tissue Inc. drove the company into bankruptcy - and flushed $300 million down the drain - by inflating profits with the help of a document-shredding auditor from Arthur Andersen, the feds have alleged. Former President Mehdi Gabayzadeh, and an ex-employee, Ali Amzad, were arrested on corporate fraud charges yesterday in connection with the collapse of the Hauppauge, L.I.-based paper company on Sept. 10, 2001. Brendon McDonald, a former senior auditor with the now-defunct Arthur Andersen, was also nabbed on obstruction of justice charges for allegedly shredding documents in his Melville, L.I., office one week before American Tissue went belly-up. "This is a classic case of corporate greed, fraud and obstruction," said U.S. Attorney Roslynn Mauskopf, announcing the case to be prosecuted in federal court in Central Islip. Authorities said American Tissue - formerly the fourth-largest tissue manufacturer in the country - recorded $25 million in phony sales between November of 2000 and May of 2001 on the orders of Gabayzadeh, who allegedly concocted an elaborate shell game that involved two affiliated companies. "When the scheme was ultimately uncovered, and American Tissue's house of cards collapsed, its investors, its lenders, and its bond holders lost nearly $300 million and most of American's 2,700 employees were laid off," Mauskopf said. Two additional executives, Edward Stein, the former chief financial officer, and John Lorenz, the former vice president of finance, pleaded guilty to fraud charges earlier this year and helped investigators build their case against McDonald, court papers show. American Tissue's financial problems began in 1999, when company executives aggressively pushed for expansion - purchasing several additional manufacturing facilities - despite an increasingly depressed paper market, prosecutors said. The "desperate" and "cash poor" company made "a false appearance of a profitability" for its lender LaSalle National Bank - which offered a $145 million revolving credit line - by manipulating the books to show $25 million in sham sales, Mauskopf said. American Tissue obtained further financing through $165 million in publicly traded bonds in July of 1999. Company executives avoided paying money they owed LaSalle and others by diverting millions of dollars to other affiliated companies, including American Paper Corp. and Super American Tissue Inc. - two Hauppauge-based companies also named in the indictment unsealed yesterday. The scheme unraveled when American Tissue declared bankruptcy in September 2001, and began to restructure under new management. The new lenders quickly uncovered the $25 million in phony sales and notified authorities, court papers say. These bogus sales, which were reported to the SEC, are the basis of a new civil fraud action announced yesterday. Gabayzadeh, 58, of Kings Point, faces up to 45 years in prison if convicted of bank and securities fraud. McDonald, 27, of Levittown, faces a maximum 10-year sentence for obstruction of justice. "The government is simply wrong in its assesment of the facts," Gabayzadeh's lawyer Benjamin Brafman said. "I believe that Mr. Gabayzadeh will be completely exonerated when he gets to try this case before a jury of his peers." He was released on $5 million bail.

To: RockyBalboa who wrote (11234)	3/11/2003 11:46:20 AM
From: StockDung	Respond to of 19428

"Waksal bought ImClone put options through a Swiss account in December 2001." Waksal settles charges SEC says former ImClone chairman to pay more than $800,000 in fines and accept ban. March 11, 2003: 11:17 AM EST NEW YORK (CNN/Money) - Former ImClone Chairman Sam Waksal has settled charges stemming from his attempted insider trading and agreed to pay more than $800,000 in fines, the Securities and Exchange Commission said Tuesday. Without admitting or denying charges against him, Waksal has agreed to be banned from serving as an executive of a public company to partially resolve an insider trading case brought by the SEC. The agreement will also settle new charges that Waksal bought ImClone put options through a Swiss account in December 2001. Former ImClone Chairman Sam Waksal The agreement settles the SEC's charges that Waksal illegally tried to sell about $5 million in ImClone stock between Dec. 26 and 28, 2001. According to the charge, he tried to make the sale after getting a tip that the Food and Drug Administration was going to publicly reject his company's application for approval of an anti-cancer drug, Erbitux. The agreement also settles charges that Waksal told his daughter Aliza to sell all of her ImClone stock on Dec. 27. Other charges, including the accusation that he tipped another family member to sell ImClone stock on Dec. 27 and 28, will be settled after similar criminal charges against Waksal are resolved. In the criminal proceeding, Waksal has pleaded guilty to six of 13 insider trading charges and awaits sentencing. He did not plead guilty to charges that said his father and daughter knew they had improper inside information before selling shares. Last week Waksal also pleaded guilty to additional criminal charges of evading $1.2 million in sales taxes on art purchases. Waksal's friend, home-decorating guru Martha Stewart, sold ImClone shares on Dec. 27, sales that are also being investigated by regulators. Stewart has insisted she did nothing wrong, saying she had no advance knowledge of the FDA decision on Erbitux. Stewart says she had an agreement with her broker to sell the shares if they fell below $60. Shares of Martha Stewart Living Omnimedia (MSO: up $0.07 to $7.52, Research, Estimates) have suffered as a result. ImClone (IMCL: down $0.17 to $15.08, Research, Estimates) shares have recovered some of their losses from earlier in the year. Waksal is just one of many executives who have been accused of white-collar crimes this year. Since the collapse of Enron Corp. last year, former executives of WorldCom, Tyco International and Adelphia Communications, as well as Enron, have been indicated for fraud, tax evasion, and on other charges. Waksal resigned in May, when the company learned that federal charges were going to be filed.

To: RockyBalboa who wrote (11234)	3/18/2003 4:30:20 PM
From: Sir Auric Goldfinger	Read Replies (2) \| Respond to of 19428

Street.com weighs in on WEL, LOL: thestreet.com Boots & Coots Jumps Despite Bankruptcy Threat By Matthew Goldstein Senior Writer 03/18/2003 03:56 PM EST Click here for more stories by Matthew Goldstein It's usually a red flag for investors when a company warns it may file for bankruptcy. Yet that threat hasn't stopped investors from piling into shares of Boots & Coots (WEL:Amex - news - commentary - research - analysis) in the past few weeks. Shares of the Houston-based company that made a name for itself putting out the oil-well fires during the first Iraq war are up more than 900% this year, rising from 16 cents a share to $1.76. On Tuesday alone, shares nearly doubled, rising 57 cents on heavier-than-normal trading. It appears that with the nation just hours away from invading Iraq, Boots & Coots has become the speculative stock of the moment for those trying to make a quick buck off the war. If Saddam Hussein orders his soldiers to set the nation's oil wells ablaze, Boots & Coots could be called into action again. In the past Boots & Coots has had a working relationship with Halliburton's (HAL:NYSE - news - commentary - research - analysis) Kellogg Brown & Root subsidiary, which the Pentagon has tapped to oversee the efforts to control any oil-well fires. (Halliburton is the company formerly led by Vice President Dick Cheney.) But for investors, sinking money into Boots & Coots looks like a bit of a gamble and may be best suited to daytraders, not longer-term investors. Related Stories Four Merrill Bankers Charged in Enron Scandal Wall Street Greed Is Alive and Well Bank Shares Showing Volume Discount Last month Boots & Coots announced it's considering filing a bankruptcy reorganization plan along the lines of one that's been proposed by its main creditor, Checkpoint Business. In January, Checkpoint notified Boots & Coots that it was in default on its loan agreement. A few weeks later, Boots & Coots and Checkpoint renegotiated some of the terms of that loan, but the company's finances remain in a precarious situation. During the first nine months of last year, the company recorded a net loss of $7.6 million. Its revenue dropped by 19% to $11.5 million. Boots & Coots' most recent quarterly filing included a comment raising doubts about the company's ability to continue as a "going concern." The danger for investors is that once a company files for bankruptcy, the existing stock usually becomes worthless. That's because stockholders stand last in line behind a company's creditors and bondholders in laying claim to a company's assets.