Order Code RL31961
CRS Report for Congress
Received through the CRS Web
Civil Charges in Corporate Scandals
Updated December 14, 2004
Mark Jickling
Specialist in Public Finance
Government and Finance Division
Paul H. Janov
Information Research Specialist
Information Research Division
Congressional Research Service ˜ The Library of Congress

Civil Charges in Corporate Scandals
Summary
Since the collapse of Enron Corp. in late 2001, there has been a series of
scandals involving major U.S. corporations. This report lists civil suits filed by
federal regulatory agencies charging individuals and corporations with violations
related to these scandals. The list is limited to corporations and their officers or
employees that fit within the Enron pattern. That is, these are cases that display one
or more of the following: irregular accounting and auditing, management self-
dealing, conflicts of interest between firms and financial advisors (or Wall Street
firms and their customers), and manipulation or abusive trading in energy markets.
Small “garden variety” examples of securities or accounting fraud are excluded.
A number of these cases have also resulted in criminal indictments, some
followed by guilty pleas. These post-Enron criminal charges are listed in
CRS Report RL31866, Criminal Charges in Corporate Scandals.
The civil cases listed here include only those filed by federal regulatory agencies
— principally the Securities and Exchange Commission (SEC), but also a few
actions by the Commodity Futures Trading Commission (CFTC) and the Federal
Energy Regulatory Commission (FERC). Private lawsuits, such as shareholder
derivative actions, are not included, although many of the companies listed are targets
of multiple private suits brought by investors, employees, and others.
It should be noted that the most common form of resolution of civil cases like
these is the consent agreement, whereby the defendant neither admits nor denies any
wrongdoing. Despite the formal nonadmission of guilt, the consent agreement often
imposes fines and other sanctions. These are described in the list.
This report will be updated as events warrant.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
List of Tables
Table 1. List of Civil Charges Filed by Federal Regulators in Corporate
Scandals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Civil Charges in Corporate Scandals
Introduction
The collapse of Enron Corp. in late 2001 marked the beginning of a long series
of scandals involving major U.S. corporations. This report lists civil suits filed by
federal regulatory agencies charging individuals and corporations with violations
related to these scandals. The list is limited to companies and their officers or
employees that fit within the Enron pattern. That is, these are cases that display one
or more of the following: irregular accounting and auditing, management self-
dealing, conflicts of interest between firms and financial advisors (or Wall Street
firms and their customers), and manipulation or abusive trading in energy markets.
Small “garden variety” examples of securities or accounting fraud are excluded.
A number of these cases, noted in the table, have also resulted in criminal
indictments, some followed by guilty pleas. These post-Enron criminal charges are
listed in CRS Report RL31866, Criminal Charges in Corporate Scandals.
The civil cases listed here include only those filed by federal regulatory agencies
— principally the Securities and Exchange Commission (SEC), but also a few
actions by the Commodity Futures Trading Commission (CFTC) and the Federal
Energy Regulatory Commission (FERC). Private lawsuits, such as shareholder
derivative actions, are not included, although many of the companies listed are targets
of multiple private suits brought by investors, employees, and others.
The most common form of resolution of civil cases like these is the consent
agreement, whereby the defendant neither admits nor denies any wrongdoing.
Despite the formal nonadmission of guilt, the consent agreement often imposes fines
and other sanctions. These are described in the list.
Descriptions of the charges are mostly drawn from government agency press
releases or other documents. These are accessible on the agencies’ websites. For
example, SEC press releases are available at [http://www.sec.gov/news/press.shtml],
CFTC press releases are available at [http://www.cftc.gov/cftc/cftcpressoffice.htm],
and FERC’s at [http://www.ferc.gov/press-room/press-releases.asp]. These press
releases often contain links to the actual court filings, which provide more detailed
descriptions of the cases.
Additional abbreviations used in the following table are NASD (National
Association of Securities Dealers), NYSE (New York Stock Exchange), and NASAA
(North American Securities Administrators Association).

CRS-2
Table 1. List of Civil Charges Filed by Federal Regulators in Corporate Scandals
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Adams Harkness, Inc.
8/25/04 (S)
The SEC announced that it had settled enforcement actions against the
SEC Press Release
seven broker-dealers for failing to disclose that they had received
2004-117
Friedman, Billings, Ramsey & Co., Inc.
payments for providing research coverage of certain public
companies, in violation of the Securities Act of 1933. Pursuant to the
Janney Montgomery Scott LLC
enforcement actions, the seven firms will pay penalties totaling
$3,650,000.
Morgan Keegan & Co., Inc.
Needham & Company, Inc.
Prudential Equity Group, LLC
SG Cowen & Co., Inc.
Adelphia Communications
7/24/02 (F)
The SEC charges that Adelphia and the named individuals (1)
SEC Press Release
fraudulently concealed corporate liabilities by placing them on the
2002-110
John J. Rigas, founder
books of off-balance-sheet entities, (2) falsified reported financial
results, and (3) concealed rampant self-dealing, including diversion of
Timothy J. Rigas
corporate funds to private uses. Disgorgement of ill-gotten gains and
a bar from service as officers or directors of public companies are
Michael J. Rigas
sought.
James P. Rigas
James R. Brown, senior executive
Michael C. Mulcahy, senior executive

CRS-3
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Alliance Capital Management L.P.
12/18/03 (S)
The SEC settled enforcement action against Alliance Capital for
SEC Press Release
defrauding mutual fund investors by allowing market timing in certain
2003-176
of its mutual funds in exchange for fee-generating investments in
other Alliance Capital investment vehicles. The commission ordered
Alliance Capital to pay $250 million, consisting of $150 million in
disgorgement and $100 million in penalties. All of the money will be
distributed to the shareholders harmed by Alliance Capital’s market
timing arrangements.
American Express Financial Advisors
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
Inc.
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $3,706,693.
Arthur Andersen
Phillip E. Harlow, senior partner
1/27/03 (S)
Settled charges by the SEC relating to Harlow’s work at Sunbeam
Washington Post,
Corp. Harlow was barred from practicing accounting before the SEC
1/28/03, p. E1
for three years.
Banc of America Securities LLC (BAS)
3/10/04 (S)
The SEC settled enforcement action against BAS for violations of the
SEC Press Release
record keeping and access requirements of securities laws. As part of
2004-29
the settlement, BAS agreed to a censure and a $10 million civil
penalty.
Banc One Investment Advisors
6/29/04 (S)
The SEC settled enforcement action against BOIA and Mark A.
SEC Press Release
Corporation (BOIA)
Beeson. The commission found that BOIA violated, and Beeson aided
2004-90
and abetted by allowing excessive short-term trading in One Group
funds. The commission ordered BOIA to pay disgorgement of $10
Mark Beeson, president and CEO of One
million and a civil penalty of $40 million and ordered Beeson to pay a
Group Mutual Funds (One Group)
civil penalty of $100,000.

CRS-4
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Bear, Stearns & Co. Inc.
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of research reports not based on principles of fair
2003-54
Credit Suisse First Boston LLC
dealing and good faith. The 10 firms will pay a total of $875 million
in penalties ($387.5 million) and disgorgement ($487.5 million).
Goldman, Sachs & Co.
Lehman Brothers Inc.
J. P. Morgan Securities Inc.
Merrill Lynch, Pierce, Fenner &
Smith, Incorporated

Morgan Stanley & Co. Incorporated
Citigroup Global Markets Inc. f/k/a
Solomon Smith Barney Inc.
USB Warburg LLC
U.S. Bancorp Piper Jaffray Inc.
Bear, Stearns & Co. Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $280,469.

CRS-5
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Bear Wagner Specialists LLC
3/30/04 (S)
The SEC and the NYSE announced the initiation and settlement of
SEC Press Release
enforcement actions against five NYSE specialist firms. Through
2004-42
Fleet Specialist, Inc.
particular transactions by certain of their registered specialists, the
firms violated federal securities laws and exchange rules by executing
LaBranche & Co., LLC
orders for their dealer accounts ahead of executable public customer
or “agency” orders and therefore improperly profited from trading
Spear, Leeds & Kellogg Specialists
opportunities. The firms will pay a total of $241,823,257 in penalties
LLC
and disgorgement.
Van der Moolen Specialists USA, LLC
Brecek & Young Advisors, Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $31,224.
Bridgeway Capital Management
9/15/04 (S)
The SEC settled enforcement proceedings against Bridgeway and John
SEC Press Release
Noland Ryan Montgomery in connection with more than $4.4 million
2004-131
in illegal performance-based fees that Bridgeway charged to three of
its mutual funds. The settlement requires that Bridgeway reimburse
John Noland Ryan Montgomery,
the affected fund shareholders $4,407,700, plus prejudgment interest
president
of $458,764, and that Bridgeway and Montgomery pay penalties of
$250,000 and $50,000, respectively.

CRS-6
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
CSFB (Credit Suisse First Boston)
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of fraudulent research reports and improper
2003-54
allocation of “hot” initial public offerings of stock. Paid fines totaling
$200 million.
1/22/02 (S)
Settled SEC and NASD charges relating to abusive allocations of
SEC Press Release
shares in “hot” initial public offerings of stock by paying fines totaling
2002-14
$100 million.
CMS Energy Corporation (CMS)
3/17/04 (S)
The SEC settled a fraud enforcement action against CMS and Terry
SEC Press Release
Woolley in connection with more than $5 billion in deceptive round-
2004-38
trip energy trades that grossly inflated CMS’s reported revenues.
CMS and Woolley agreed to cease and desist from committing or
Terry Woolley, controller
causing violations of the antifraud, reporting, books and records, and
internal controls provisions of the federal securities laws. Woolley
also agreed to pay a $25,000 penalty.
Preston D. Hopper, chief accounting
3/17/04 (F)
The SEC filed a civil suit for fraud and other securities law violations.
officer
Tamela C. Pallas, chief executive of
trading subsidiary
CUC International Inc. and Cendant Corporation (CUC merged with HFS Incorporated on 12/17/1997 to form Cendant Corporation)
Walter A. Forbes, CUC’s chairman and
2/28/01 (F)
The SEC charged that they directed a massive financial fraud while
SEC Litigation
CEO
selling millions of dollars worth of the company’s common stock.
Release No.
16910
E. Kirk Shelton, CUC’s president and
chief operating officer

CRS-7
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Cosmo Corigliano, CUC’s controller and
5/14/04 (S)
Cosmo Corigliano and his spouse must transfer assets that have an
SEC Litigation
CFO
aggregate value of at least $14 million to a court-appointed receiver,
Release No.
as disgorgement of unjust enrichment from a long-running financial
18711
Agnes T. Corigliano, relief defendant
fraud that he helped supervise and direct during his time at CUC
International Inc., the corporate predecessor of Cendant Corporation.
Mary Louise Scully, relief defendant
Canadian Imperial Bank of Commerce (CIBC)
Paul A. Flynn, managing director
2/03/04 (F)
The SEC charged Paul A. Flynn with fraud for his role in financing
SEC Press Release
unlawful mutual fund trading.
2004-12
Frank Quattrone, investment banker
3/06/03 (F)
The NASD charged Quattrone with “spinning” initial public offering
Wall Street
shares, that is, giving shares to executives in exchange for other
Journal, 3/07/03,
investment banking business.
p. C1.
Charles Schwab & Co., Inc.
9/14/04 (S)
The SEC settled enforcement proceedings against Charles Schwab &
SEC Press Release
Co., Inc. The commission charged that Schwab allowed investment
2004-128
adviser customers to change mutual fund orders after the 4:00 p.m.
Eastern time market close, creating the risk that such customers could
unfairly capitalize on late-breaking news at the expense of other
mutual fund investors. Schwab consented to the entry of an order that
it cease and desist from such violations and pay a $350,000 civil
penalty.
Citigroup, Inc.
7/28/03 (S)
Settled charges by the SEC regarding Citigroup’s role in Enron
SEC Press Release
Corporations’s manipulation of its financial statements and assistance
2003-87
it provided Dynegy Inc. in manipulation of that company’s financial
statements. Citigroup was ordered to pay $120 million as
disgorgement, interest, and penalty. Of that amount, $101 million
pertains to Citigroup’s Enron-related conduct and $19 million pertains
to the Dynegy conduct.

CRS-8
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Columbia Management Advisors, Inc.
2/24/04 (F)
The SEC charged that the firms allowed certain preferred mutual fund
SEC Press Release
Columbia Funds Distributor Inc.
customers to engage in short-term and excessive trading, while at the
2004-20
same time representing publicly that it prohibited such trading.
Computer Associates International,
9/22/04 (S)
The SEC announced securities fraud charges against Computer
SEC Press Release
Inc.
Associates International, Inc. and three of the company’s former top
2004-134
executives. The SEC alleges that from 1998 to 2000, Computer
Associates routinely kept its books open to record revenue from
Sanjay Kumar, CEO and chairman
Department of
contracts executed after the quarter ended in order to meet Wall Street
Justice, 9/22/04,
quarterly earnings estimates. Computer Associates agreed to
Press Release 642
settlements with the SEC and the Justice Department in which the
Stephen Richards, head of sales
company will pay $225 million in restitution to shareholders and will
make reforms to its corporate governance and financial accounting
controls. Woghin agreed in a partial settlement to a permanent
Steven Woghin, general counsel
injunction and officer and director bar with monetary sanctions to be
decided at a later point.
Cresap, Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $99,458.
Datek Securities Corp.
1/24/02 (S)
Agreed to pay fines totaling about $6.3 million to settle SEC securities fraud
Wall Street Journal,
charges relating to abusive trading on the NASDAQ stock market.
1/25/02, p. C9.
Sheldon Maschler, trader
1/14/03 (S)
The four agreed to pay fines totaling about $53 million to settle SEC
Wall Street Journal,
charges relating to abusive trading on the NASDAQ stock market.
1/15/03, p. C1.
Jeffrey Citron, trader
Aaron Elbogen, CEO
Moishe Zelcer, compliance officer

CRS-9
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
David Lerner Associates, Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $32,711.
Deutsche Bank Securities
12/03/02 (S)
Paid a $1.65 million fine to settle SEC charges relating to failure to
SEC Press Release
retain e-mail records.
2002-173
Dynegy Inc.
9/24/02 (S)
Settled SEC charges relating to improper and misleading accounting
SEC Press Release
(relating to fictitious “round-trip” energy trades) by paying a $3
2002-140
million fine.
12/19/02 (S)
CFTC settled charges that Dynegy and West Coast Power manipulated
CFTC Release
the price of natural gas by reporting false price and volume
4728-02
information. Dynegy agreed to cease and desist from further
violations and pay a $5 million fine.
Gene S. Foster, vice president
6/12/03 (F)
Charged by the SEC with disregarding accounting advice from
SEC Press Release
Dynegy’s outside auditors, establishing secret side agreements to
2003-72
Jamie Olis, vice president
conceal their improper conduct, and concealing transaction details
from the company, the company’s auditors, and the investing public.
Helen C. Sharkey, manager

CRS-10
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Enron Corp.
Andrew Fastow, chief financial officer
10/02/02 (F)
Based on charges of violations of antifraud, record keeping, and
SEC Press Release
internal controls provisions of securities laws, the SEC seeks
2002-143
disgorgement of ill-gotten gains, including compensation, civil money
1/14/04 (S)
penalties, and a bar from serving as an officer or director of a public
SEC Press Release
company. The commission settled its action in coordination with the
2004-6
Justice Department’s Enron Task Force, which entered into a guilty
plea with Fastow on related criminal charges. In resolving the parallel
civil and criminal proceedings, Fastow has agreed to serve a 10-year
sentence, to disgorge more than $23 million, and to cooperate with the
government’s continuing investigation.
Michael J. Kopper, corporate official
8/21/02 (S)
To settle SEC charges of securities fraud, related to misleading
SEC Press Release
accounting practices, Kopper agreed to disgorge and forfeit about $12
2002-126
million, and to be barred from serving as an officer or director of a
public company.
Hunter Shively, natural gas trading
3/13/03 (F)
The CFTC charged Shively and Enron with manipulating natural gas
CFTC Release
supervisor
prices and operating an illegal futures exchange.
4762-03
Richard A. Causey, chief accounting
1/22/04 (F)
Charged with violating, and aiding and abetting the violations of, the
SEC Litigation
officer
antifraud, periodic reporting, books and records, and internal controls
Release No.
provisions of the federal securities laws.
18551
Jeffrey K. Skilling, president, CEO, COO
2/19/04 (F)
Charged with violating, and aiding and abetting violations of, the
SEC Press Release
antifraud, lying to auditors, periodic reporting, books and records, and
2004-18
internal controls provisions of the federal securities laws.

CRS-11
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Paula H. Rieker
5/19/04 (S)
The SEC charged Rieker with violating the antifraud provisions of the
SEC Litigation
federal securities laws. Without admitting or denying the allegations,
Release No.
Rieker agreed to be barred from acting as an officer or director of a
18717
public company and will, subject to the approval of the U.S. District
Court, pay disgorgement, prejudgment interest, and a civil penalty
totaling $499,333.
Kenneth L. Lay, chairman and CEO
7/8/04 (F)
The SEC initiated civil charges against Lay for his role in a wide-
SEC Press Release
ranging scheme to defraud by falsifying Enron’s publicly reported
2004-94
financial results and making false and misleading public
representations about Enron’s business performance and financial
condition.
Enron Broadband Services, Inc.
Kenneth D. Rice, CEO
3/12/03 (F)
Charged with violating antifraud laws and personally reaping $150
SEC Press Release
5/01/03 (F,
million in unlawful profits. The suit seeks disgorgement and civil
2003-58
Joseph Hirko, CEO
amended)
money penalties.
Kevin P. Hannon, chief operating officer
Rex Shelby, vice president
F. Scott Yeager, vice president
Kevin A. Howard, executive
Michael W. Krautz, executive

CRS-12
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Fidelity Brokerage Services, LLC
8/3/04 (S)
The SEC and the New York Stock Exchange announced the initiation
SEC Press Release
and settlement of enforcement actions against Fidelity Brokerage
2004-103
Services, LLC, as a result of the alteration or destruction of documents
in numerous Fidelity Brokerage branch offices. In settlement of these
actions, Fidelity Brokerage will pay a total of $2 million, consisting of
a $1 million civil penalty imposed by the SEC and a $1 million fine
imposed by the NYSE.
Foreign Currency (forex) Futures
11/18/03 (F)
The U.S. Commodity Futures Trading Commission announced that it
CFTC Release
Contracts
filed six separate federal injunctive actions, charging a total of 31
4867-03
individuals and entities with engaging in fraud in the sale and
solicitation of illegal foreign currency futures contracts. The CFTC
New York Times,
actions resulted from participation in Operation Wooden Nickel, an
11/20/03, sec. C,
undercover law enforcement sting run by federal enforcement
p. 1, col. 2
personnel.
Wall Street
Journal,
11/20/03,
p. C1
Franklin Advisers, Inc.
8/2/04 (S)
The SEC announced that Franklin Advisers, Inc., an investment
SEC Press Release
adviser firm in the fourth largest U.S. mutual fund complex, has
2004-102
agreed to pay $50 million and to undergo compliance reforms to settle
charges that it permitted rapid in-and-out trading, known as market
timing, in mutual funds that it managed, contrary to fund prospectus
wording.

CRS-13
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
12/13/04 (S)
The SEC filed settled charges against Franklin Advisers, Inc. and
SEC Press Release
Franklin Templeton Distributors, Inc. alleging that Franklin, without
2004-168
proper disclosure, used fund assets to compensate brokerage firms for
recommending the Franklin Templeton mutual funds over others to
their clients. This practice is known as compensating brokerage firms
for “shelf space.” As part of the settlement, Franklin agreed to pay $1
in disgorgement and a $20 million penalty as well as undergo certain
compliance reforms.
Fremont Investment Advisors
11/4/04 (S)
The SEC charged Fremont, Tengler, and Adams with market timing. It
SEC Press Release
also charged Fremont for allowing mutual fund trades to be placed
2004-153
after the 4:00 p.m. market close. Fremont agreed to pay $4.146
Nancy Tengler, president and CEO
11/4/04 (S)
million, and Tengler agreed to pay $127,000 and be suspended from
the industry for six months to settle the Commission’s fraud charges.
Larry Adams, vice president
11/4/04 (F)
The civil action against Adams is still open.
Gateway, Inc.
11/13/03 (S)
The SEC charged that Gateway, Inc., violated the antifraud, reporting,
SEC Press Release
and record keeping provisions of the federal securities laws. Without
2003-157
admitting or denying the commission’s findings, Gateway consented
to cease and desist from committing or causing any violation or future
violation of these provisions.
Jeffrey Weitzen, CEO
11/13/03 (F)
The SEC charged that each engaged in a fraudulent earnings
manipulation scheme to meet Wall Street analysts’ expectations and
John J. Todd, senior vice president, CFO
that each made false statements and concealed from the investing
public important information about the success of Gateway’s personal
Robert D. Manza, controller
computer business in the second and third quarters of 2000.

CRS-14
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Gemstar-TV Guide International, Inc.
Henry C. Yuen, CEO
6/19/03 (F)
Charged with securities fraud whereby the two overstated revenues
SEC Press Release
and reported the inflated revenues to the investing public. The suit
2003-75
seeks antifraud injunctions, civil money penalties, disgorgement of ill-
Elsie M. Leung, CFO
gotten gains, and a permanent bar from service as an officer or
director of a public company.
Peter C. Boylan, co-president
1/5/04 (F)
The SEC charged that these executives participated in Gemstar’s
SEC Press Release
widespread and complex scheme to inflate its licensing and
2004-1
advertising revenue and to mislead investors about the company’s true
financial performance.
Jonathan B. Orlick, general counsel
8/10/04 (S)
The SEC agreed to settle with Peter C. Boylan. As part of the
SEC Litigation
settlement, Boylan will consent to a fraud injunction, without
Release No.
admitting or denying the allegations in the Commission’s complaint,
18826
Craig Waggy, CFO
and will pay a total of $600,000 in disgorgement and civil penalties.
Goldman, Sachs
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of research reports not based on principles of fair
2003-54
dealing and good faith. Paid fines totaling $110 million.
12/03/02 (S)
Paid a $1.65 million fine to settle SEC and NASD charges relating to
SEC Press Release
failure to retain e-mail records.
2002-173
9/04/03 (S)
Charged Goldman, Sachs willfully violated the provisions of the
SEC Press Release
Exchange Act that prohibit fraud by broker-dealers and government
2003-107
securities dealers. Ordered Goldman, Sachs to disgorge $1,742,642 in
bond trading profits and prejudgment interest and to pay a penalty of
$5 million.

CRS-15
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
John M. Youngdahl, vice president
9/04/03 (F)
SEC filed securities fraud charges alleging that he traded the 30-year
SEC Press Release
bond using confidential information from the Treasury Department.
2003-107
11/12/03 (S)
John M. Youngdahl settled the commission’s pending insider trading
SEC Press Release
charges against him. He will be permanently enjoined from
2003-155
committing securities fraud and will pay a civil penalty of $240,000.
H. D. Vest Investment Securities, Inc.
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $725,216.
Halliburton Co.
8/3/04 (S)
The SEC announced enforcement proceedings against Halliburton,
SEC Press Release
Muchmore, and Morris in response to Halliburton’s failure to disclose
2004-104
a 1998 change to its accounting practice. As a result of that
undisclosed change, Halliburton’s public statements about its income
in 1998 and 1999 were materially misleading. Halliburton and
Robert C. Muchmore, Jr., controller
Muchmore agreed to settle the enforcement actions by consenting to a
commission order to cease and desist from committing future
securities law violations and agreed to pay penalties of $7.5 million
and $50,000, respectively, in related civil action.
Gary V. Morris, CFO
8/3/04 (F)
The enforcement action against Morris is unsettled, and it has been
filed in the U.S. District Court in Houston, Texas.
HealthSouth
3/18/03 (F)
SEC charges were based on overstatement of reported earnings by at
SEC Press Release
least $1.4 billion since 1999. Assets of CEO Richard Scrushy were
2003-38
frozen by court order.
Richard Scrushy, CEO
3/19/03 (F)
Charged with accounting fraud by the SEC, which seeks monetary
SEC Press Release
penalties and a bar from serving as an officer or director of a public
2003-34
company.

CRS-16
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Heartland Advisors, Inc.
12/11/03 (F)
Charged by the SEC with misrepresentations, mispricing, and insider
SEC Press Release
trading in two Heartland Group high yield bond funds.
2003-171
William Nasgovitz, CEO
Paul Beste, COO
Jilaine Bauer, general counsel
Kevin Clark, senior vice president
Kenneth Della, treasurer
Thomas Conlin, portfolio manager
Greg Winston, portfolio manager
Hugh Denison, associate director
John Hammes, independent director
Gary Shilling, independent director
Allen Stefl, independent director
Linda Stephenson, independent director
FT Interactive Data Corp., independent
pricing service
Raymond Krueger, client
Homestore Inc.
John Giesecke, Jr., CEO
9/25/02 (S)
SEC charged that Homestore’s revenues were fraudulently overstated
SEC Press Release
by 60% during 2001. The three individuals agreed to pay fines
2002-141
Joseph J. Shew, CFO
totaling about $5 million, and were barred from serving as officers or
directors of public companies.
John DeSimone, vice president

CRS-17
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Jeffrey Kalina,a senior manager
1/9/03 (S)
Charged by the SEC with financial fraud scheme. Agreed to settle
SEC Litigation
with the commission and cooperate with the government in its
Release No.
investigation.
17924
Thomas Vo,a manager
9/18/03 (S)
The SEC charged the defendants variously with violating or aiding
SEC Press Release
and abetting violations of numerous provisions of the federal
2003-120
Sailesh Patel,a director of business
securities laws.
development
Jessica McLellan,a manager
Sophia M. Kabler, senior vice president
Adam S. Richards, manager of financial
planning
David Slayton, CFO of NameProtect, Inc.
Brian Wiegand, CEO of NameProtect,
Inc.
Household International
3/19/03 (S)
SEC charged Household International with false and misleading
SEC Press Release
accounting statements regarding delinquent loans. Household agreed
2003-35
to cease and desist from these accounting practices.

CRS-18
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
i2 Technologies, Inc.
6/9/04 (S)
The SEC brought enforcement proceedings against i2 Technologies,
SEC Press Release
Inc., for misstating approximately $1 billion of software license
2004-81
revenues, including more than $125 million of revenues it should
never have recognized, over a nearly five-year period that ended in
2002. i2 agreed to settle the enforcement proceedings by consenting
to a cease-and-desist order and to pay a $10 million penalty in a
related civil action filed in U.S. District Court. The entire penalty
proceeds will be distributed to injured i2 shareholders.
ICN Pharmaceuticals
12/29/02 (S)
SEC securities fraud charges were settled when ICN agreed to comply
Hepatitis Weekly,
with detailed corporate governance and disclosure-related
13/03/02, p. 21.
undertakings for a period of five years and to pay a $1 million fine.
ImClone Systems
Samuel Waksal, CEOa
6/12/02 (F)
SEC charged Waksal with insider trading and sought disgorgement
SEC Press Release
and a bar from serving as an officer or director of a public company.
2002-87
Waksal settled the suit by agreeing to pay about $800,000 and
3/11/03 (S)
submitting to the bar on being an officer/director.
Jack Waksal
10/10/03 (F)
SEC charged Jack Waksal with trading ImClone Systems stock as a
SEC Litigation
result of insider information provided by his son, Samuel Waksal.
Release No.
18408
InterBank Funding Corp.
7/23/02 (F)
The SEC filed fraud charges relating to the concealment of losses in a
Wall Street
group of mutual funds.
Journal, 7/24/02,
Simon A. Hershon, CEO
p. C12.

CRS-19
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Invesco Funds Group, Inc. (IFG)
12/2/03 (F)
The SEC announced civil fraud charges against IFG and Cunningham.
SEC Press Release
According to the charges, IFG and Cunningham fraudulently accepted
2003-167
investments by dozens of market timers in Invesco Mutual funds to
Raymond R. Cunningham, CEO and
enhance the management fees earned by IFG.
president
Timothy J. Miller, chief investment
8/31/04 (S)
The SEC settled enforcement actions against Miller, Kolbe, and
SEC Press Release
officer (IFG)
Legoski. The commission issued orders alleging that they violated
2004-123
federal securities laws by facilitating widespread market timing
trading in certain Invesco funds in contravention of those funds’
Thomas A. Kolbe, national sales manager
public disclosures. The commission ordered Miller, Kolbe, and
(IFG)
Legoski to pay $1 in disgorgement each and penalties in the amounts
of $150,000, $150,000, and $40,000, respectively, and prohibited
Michael D. Legoski, assistant vice
them from associating with an investment adviser or investment
president (IFG)
company for a period to one year.
J. P. Morgan Chase & Co.
7/28/03 (S)
Settled charges by the SEC regarding its role in Enron Corp.’s
SEC Press Release
manipulation of its financial statements. J.P. Morgan Chase was
2003-87
ordered to pay $135 million as disgorgement, penalty, and interest.
JB Oxford Holdings, Inc. (JBOH)
8/25/04 (F)
The SEC filed civil fraud charges against NCC, its parent company
SEC Press Release
National Clearing Corporation (NCC)
JBOH, and three executives for facilitating late trading and market
2004-119
timing by certain NCC customers. The SEC’s complaint alleges that
James G. Lewis, president and COO
from June 2002 until September 2003, the defendants fraudulently
(JBOH)
facilitated thousands of market timing and late trades in over 600
mutual funds.
Kraig L. Kibble, director of operations
(NCC)
James Y. Lin, vice president (NCC)

CRS-20
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Janus Capital Management LLC
8/18/04 (S)
The SEC announced today a settled enforcement action against JCM
SEC Press Release
(JCM)
for entering into undisclosed market timing agreements with certain
2004-111
investors. The commission ordered JCM to pay a disgorgement of
$50 million and civil penalties of $50 million, for a total payment of
$100 million. JCM also consented to a cease-and-desist order and a
censure, and agreed to undertake certain compliance and mutual-fund
governance reforms.
KPMG
1/14/02 (S)
The SEC censured KPMG for violating auditor independence rules by
SEC Press Release
serving as auditor for a company in which it had made substantial
2002-4
investments.
KPMG
1/29/03 (F)
The SEC charged KPMG and four individuals with permitting Xerox
SEC Press Release
Corp. to manipulate accounting practices to close a $3 billion gap
2003-16
Michael A. Conway, senior partner
between actual operating results and the results reported in published
accounting statements. The four individuals were at various times
Joseph T. Boyle, managing partner
leaders of the team that performed the Xerox audit.
Anthony P. Dolanski, partner
Ronald A. Safran, partner
Kirkpatrick, Pettis, Smith, Polian Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $39,935.

CRS-21
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Kmart
Joseph A. Hofmeister, vice president
2/26/03 (F)
The SEC charged the two with accounting fraud and seeks
Wall Street
disgorgement of ill-gotten gains and money penalties.
Journal, 2/27/03,
Enio A. Montini Jr., vice president
p. A3
Legg Mason Wood Walker, Inc.
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $2,315,467.
Lehman Brothers Inc.
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of research reports not based on principles of fair
2003-54
dealing and good faith. Paid fines totaling $80 million.
Lehman Brothers Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $123,882.
Lernout & Hauspie
10/10/02 (F)
SEC charged L&H with accounting fraud, related to overstatement of
Boston Globe,
revenues by at least $100 million.
10/11/02, p. E2
Linsco/Private Ledger Corp.
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $2,232,805.

CRS-22
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Lucent Technologies
2/27/03 (S)
Lucent settled an SEC investigation into its accounting practices with
Wall Street
a consent agreement that did not require restatement of earnings or
Journal, 2/28/03,
payment of a fine.
p. B7
5/17/04 (S)
Lucent agreed to settle charges by the SEC of securities fraud, and
SEC Press Release
violations of the reporting, books and records, and internal control
2004-67
provisions of the federal securities laws. Without admitting or
denying the allegations, Lucent agreed to pay a $25 million penalty
for its lack of cooperation.
Nina Aversano, officer
5/17/04 (F)
Securities fraud
SEC Press Release
2004-67
Jay Carter, officer
Leslie Dorn, executive
William Plunkett, executive
5/17/04 (S)
Plunkett agreed to pay a civil penalty of $110,000 and to be
permanently barred from acting as an officer or director of a public
company.
John Bratten, executive
5/17/04 (F)
Securities fraud
Deborah Harris, executive
5/17/04 (S)
Harris will pay a civil penalty of $100,000 and has agreed to be barred
from acting as an officer or director of a public company for five
years.
Charles Elliott, employee
5/17/04 (F)
Securities fraud
Michelle Hayes-Bullock, employee
5/17/04 (S)
Securities fraud
Vanessa Petrini, employee
5/17/04 (F)
Petrini will pay a civil penalty of $60,000 and disgorge $109,505.

CRS-23
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Marque Millennium Group, Inc.
12/15/03 (S)
The SEC charged Littell with defrauding investors and Meckel with
SEC Press Release
failing reasonably to supervise Littell. Littell and Meckel each settled
2003-172
Wilfred Meckel, principal
the actions without admitting or denying the commission’s findings.
Robert T. Littell, director of investments
Martha Stewart Living Omnimedia
Martha Stewart, chairman and CEOa
6/4/03 (F)
The SEC charged Stewart with illegal insider trading.
SEC Press Release
2003-69
Peter Bacanovic, stockbrokera
6/4/03 (F)
The SEC charged Bacanovic with securities fraud.
SEC Press Release
2003-69
Massachusetts Financial Services Co.
2/5/04 (S)
The SEC charged MFS and its chief executive officer, John W. Ballen,
SEC Press Release
(MFS)
and its president and chief equity officer, Kevin R. Parke, with
2004-14
violating federal securities laws by allowing widespread market
timing trading in certain MFS mutual funds in contravention of those
funds’ public disclosures. The commission censured MFS and
ordered it to pay $225 million, consisting of $175 million in
disgorgement and $50 million in penalties.
John W. Ballen, CEO
2/5/04 (S)
The commission prohibited Ballen and Parke from serving as officers
SEC Press Release
or directors of any investment adviser and from serving as employees,
2004-14
officers, or trustees of any registered investment company for three
years. Additionally, each was ordered to pay a penalty of $250,000
Kevin R. Parke, president and chief
and to disgorge more than $50,000 in ill-gotten gains derived from
equity officer
MFS’s market timing practices.

CRS-24
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Massachusetts Financial Services Co.
3/31/04 (S)
The SEC announced a settled enforcement action against MFS related
SEC Press Release
(MFS)
to the company’s use of mutual fund assets to pay for the marketing
2004-44
and distribution of mutual funds in the MFS Fund Complex (MFS
Funds). As part of the settlement, MFS agreed to a series of
compliance reforms and to pay a penalty of $50 million, which will be
distributed to the MFS Funds.
Merrill Lynch
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of fraudulent research reports not based on
2003-54
principles of fair dealing and good faith. Paid fines totaling $200
million.
Henry Blodgett, managing director and
4/26/03 (S)
Charged by the SEC with issuing false research reports, Blodgett
SEC Press Release
senior research analyst
agreed to pay $4 million and to be censured and barred from the
2003-56
securities industry for life.
Robert S. Furst, senior executive
3/17/03 (F)
The four are charged by the SEC with aiding and abetting accounting
SEC Press Release
fraud at Enron Corp., by engaging in fraudulent transactions designed
2003-32
Schuyler M. Tilney, senior executive
to overstate Enron’s earnings. Merrill Lynch (the firm) was also
charged, but agreed to settle the charges by paying $80 million in
Daniel H. Bayly, senior executive
disgorgement and penalties.
Thomas W. Davis, senior executive

CRS-25
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Morgan Stanley
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
of making undisclosed payments for research reports. Paid fines
2003-54
totaling $125 million.
12/03/02 (S)
Paid a $1.65 million fine to settle SEC and NASD charges relating to
SEC Press Release
failure to retain e-mail records.
2002-173
11/17/03 (S)
Settled charges by the SEC that they failed to provide customers
SEC Press Release
important information relating to their purchases of mutual fund
2003-159
shares. As part of the settlement, Morgan Stanley will pay $50
million in disgorgement to certain Morgan Stanley customers and will
place on its website disclosures regarding the purchase of different
mutual fund share classes.
Mutuals.com, Inc.
12/4/03 (F)
Charged by the SEC with deceiving hundreds of mutual fund
SEC Press Release
companies and their shareholders by improperly helping institutional
2003-169
Richard Sapio, CEO
brokerage customers and advisory clients carry out thousands of
market timing trades and illegal late trades in shares of those mutual
Eric McDonald, president
funds.
Michele Leftwich, compliance officer
NewCom
Sultan Warris Khan, CEO
6/09/02 (S)
The three paid fines and were barred from serving as directors or
Los Angeles
officers of public companies to settle SEC charges of securities fraud
Times, 6/12/02, p.
Asif Mohammad Khan, vice president
related to overstatement of revenues.
C4.
Steven Conrad Veen, CFO

CRS-26
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Nicor Energy, LLC
Kevin M. Stoffer, president and CEO
12/10/03 (F)
The SEC filed a civil enforcement action alleging that the executives
SEC Press Release
inflated net income by $11 million in 2001 by using an array of
2003-170
Andrew J. Johnson, director of financial
improper accounting tools for the express purpose of hitting earnings
services
targets.
John Fringer, vice president
John F. Weir, director of gas services
Performance Specialist Group LLC.
7/26/04 (S)
The SEC found that between 1999 and 2003 the two firms, through
SEC Press Release
particular transactions by certain of their registered specialists,
2004-99
violated federal securities laws by executing orders for their dealer
SIG Specialists, Inc.
accounts ahead of executable public customer orders. The firms will
pay a total of $5.2 million in penalties and disgorgement.
Pilgrim Baxter & Associates, Ltd.
11/20/03 (F)
Charged with fraud and breach of fiduciary duty in connection with
SEC Press Release
market timing of the PBHG Funds.
2003-161
6/21/04 (S)
The SEC ordered Pilgrim Baxter & Associates (PBA) to pay $90
SEC Press Release
million: $40 million in disgorgement and $50 million in civil
2004-84
penalties. PBA consented to a censure and an order to cease and
desist, and further agreed to undertake a series of compliance and
mutual fund governance reforms.
Gary L. Pilgrim, president, CIO
11/20/03 (F)
Charged with fraud and breach of fiduciary duty in connection with
SEC Press Release
market timing of the PBHG Funds.
2003-161

CRS-27
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Harold J. Baxter, CEO
11/17/04 (S)
The SEC ordered Baxter and Pilgrim each to pay $80 million: $60
SEC Press Release
million in disgorgement and $20 million in civil penalties, which will
2004-157
be distributed to injured investors, along with the $90 million that
PBA paid.
PIMCO Advisors Fund Management
5/6/04 (F)
Charged with defrauding PIMCO mutual fund investors, in connection
SEC Press Release
LLC (PAFM)
with an undisclosed market timing arrangement with Canary Capital
2004-61
PEA Capital LLC (PEA)
Partners LLC.
PIMCO Advisors Distributors LLC
(PAD)
9/13/04 (S)
The SEC settled charges that PAFM, PEA, and PAD defrauded
SEC Press Release
investors in the PIMCO Funds: Multi-Manager Series (MMS) in
2004-127
connection with an undisclosed market timing arrangement. The
PIMCO entities were ordered to pay $50 million, consisting of $10
million in disgorgement and a civil penalty of $40 million. The
commission’s litigation in federal court continues against Stephen J.
Treadway and Kenneth W. Corba.
9/15/04 (S)
SEC Press Release
2004-130
Stephen J. Treadway, CEO of PAFM and
PAD
Kenneth W. Corba, CEO of PEA


CRS-28
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
PNC Financial Services Group
7/18/02 (S)
Agreed to cease and desist from accounting improprieties resulting
SEC Press Release
from transactions with special purpose entities (SPEs).
2002-109
Approximately $762 million in bad loans and venture capital
investments were transferred from PNC’s books to SPEs. Concurrent
with the SEC order, the Federal Reserve Bank of Cleveland executed a
Written Agreement with PNC, relating to the same transactions.
PricewaterhouseCoopers
7/17/02 (S)
PwC and its brokerage affiliate settled SEC charges relating to
SEC Press Release
violations of auditor independence rules and agreed to a $5 million
2002-105
fine.
Putnam Investment Management LLC
10/28/03 (F)
Engaged in securities fraud by failing to disclose to the funds or to the
SEC Press Release
fund boards the potentially self-dealing transactions in fund shares by
2003-142
Scott and Kamshad.
11/13/03 (S)
Agreed to undertake significant and far-reaching reforms in corporate
SEC Press Release
governance, compliance, and ethics. Putnam also agreed to a process
2003-156
for calculating and paying restitution for losses attributable to
excessive short-term and market-timing trading by its employees. The
amount of civil penalty and other monetary relief to be paid by
Putnum remains open and will be determined at a later date.
4/8/04 (S)
The SEC announced the final settlement (which supplements a
SEC Press Release
Commission Order entered on November 13, 2003) against Putnam.
2004-49
The firm has been ordered to pay a $50 million civil penalty and $5
million in disgorgement for violating federal securities laws by failing
to disclose improper market timing trading by Putnam portfolio
managers. All the money obtained by the commission will be
distributed to investors harmed by the market timing trading.

CRS-29
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Justin M. Scott
10/28/03 (F)
The SEC complaint alleges that for their own personal accounts Scott
SEC Press Release
and Kamshad engaged in excessive short-term trading of Putnam
2003-142
mutual funds for which they were portfolio managers, which violated
Omid Kamshad
their responsibilities to other fund shareholders.
Qwest Communications
10/21/04 (S)
The SEC charged Qwest with securities fraud and other violations of
SEC Press Release
the federal securities laws. Without admitting or denying the
2004-148
allegations in the complaint, Qwest consented to entry of judgment
from violating the antifraud provisions of the federal securities laws
and was directed to pay a civil penalty of $250 million and $1
disgorgement. The entire penalty amount will be distributed to
defrauded investors.
Joel Arnold, vice president
2/25/03 (F)
The eight individuals are charged by the SEC with engaging in civil
SEC Press Release
fraud by inflating Qwest’s revenues by about $144 million in 2000
2003-25
Grant Graham, financial officer
and 2001 through various deceptive accounting practices. The SEC
seeks monetary penalties and/or bars from serving as officers or
Thomas W. Hall, vice president
directors of public companies.
Bryan Treadway, assistant controller
John M. Walker, vice president
Douglas K. Hutchins, director
Richard L. Weston, vice president
William L. Eveleth, vice president for
finance

CRS-30
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Raymond James Financial Services,
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
Inc.
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $2,595,129.
Raytheon
11/25/02 (S)
Agreed to cease and desist from violations of the SEC’s Regulation
Boston Herald,
FD, which prohibits selective disclosure of financial results. The
11/26/02, p. 31.
company was not fined.
Reliant Resources
1/31/03 (S)
Agreed to a $13.8 million fine to settle a FERC investigation into
Orange County
evidence that Reliant withheld power to drive up electricity prices in
Register, 2/11/02,
California on June 21 and 22, 2000.
p. OC Register 1.
Rite Aid
Martin Grass, CEO
6/21/02 (F)
The SEC filed charges of accounting fraud, based on massive
Los Angeles
overstatement of financial results from 1997 through 1999. The SEC
Times, 6/22/02, p.
Frank Bergonzi, CFO
seeks disgorgement of bonuses and civil penalties and a bar from
A1.
serving as officers or directors of a public company.
Franklin Brown, vice chairman
Robertson Stephens
1/09/03 (S)
The SEC’s charges relate to the allocation of stock in “hot” initial
SEC Press Release
public offerings during 1999 and 2000. In exchange for receiving
2003-3
allocations (i.e., being allowed to buy offered shares), more than 100
customers paid millions of dollars in the form of excessive
commissions. Robertson Stephens paid $28 million to settle the
charges.
Paul Johnson, senior research analyst
1/09/03 (F)
Charged by the SEC with issuing fraudulent research reports and
failing to disclose significant conflicts of interest.

CRS-31
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
SWS Financial Services
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $66,468.
Safety-Kleen
Paul R. Humphreys, CFO
12/12/02 (F)
Charged by the SEC with financial fraud related to overstatement of
SEC Litigation
net income by $534 million between 1997 and 1999. Complaint seeks
Release No.
William D. Ridings, controller
disgorgement and officer and director bars.
17891
Kenneth W. Winger, CEO
Thomas W. Ritter, Jr., vice president
12/12/02 (S)
Enjoined from violating securities laws.
Susan Moore, financial reporting
Agreed to cease and desist from violations of securities fraud and
manager
reporting laws.
Salomon Smith Barney
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of fraudulent research reports and improper
2003-54
allocation of “hot” initial public offerings of stock. Paid fines totaling
$400 million.
12/03/02 (S)
Paid a $1.65 million fine to settle SEC and NASD charges relating to
SEC Press Release
failure to retain e-mail records.
2002-173
Jack Grubman, managing director and
4/28/03 (S)
Charged by SEC, NASD, NYSE, and New York state with issuing
SEC Press Release
research analyst
fraudulent and misleading research reports; agreed to pay $15 million
2003-55
fine.

CRS-32
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Schering-Plough Corp.
9/9/03 (S)
Charged by the SEC with violating the disclosure requirements of
SEC Press Release
Regulation FD and Section 13(a) of the Securities Exchange Act of
2003-109
1934. In settling the charges, Schering agreed to pay a $1 million
civil penalty and to cease and desist from committing such violations
in the future.
Richard J. Kogan, chairman of the board
9/9/03 (S)
Agreed to cease and desist from causing any violation of Regulation
SEC Press Release
and CEO
FD in the future and to pay $50,000 as a civil penalty.
2003-109
Security Brokerage, Inc.
12/23/03 (F)
Charged by the SEC for participating in a scheme to defraud mutual
SEC Press Release
fund shareholders through improper late trading and market timing
2003-183
principally through mutual funds managed by Alliance Capital
Daniel Calugar, president
Management and Massachusetts Financial Services.
Security Trust Company, N.A.
11/25/03 (F)
Charged by the SEC with facilitating and participating in fraudulent
SEC Press Release
mutual fund late trading and market timing schemes by a group of
2003-164
Grant D. Seeger, CEO
related hedge funds.
William A. Kenyon, president
Nicole McDermott, senior vice president
Southwest Securities, Inc.
2/12/04 (S)
The NASD settled enforcement actions for failure to deliver mutual
SEC Press Release
fund breakpoint discounts (volume discounts) during 2001 and 2002.
2004-17
The firm agreed to compensate customers for the overcharges and will
pay a fine of $36,971.
Strong Capital Management, Inc.
5/20/04 (S)
Charged with allowing and, in the case of Strong, engaging in
SEC Press Release
(SCM)
undisclosed frequent trading in Strong mutual funds in violation of
2004-69
fiduciary duties to the Strong funds and their investors. The settled
Richard S. Strong, founder and majority
order requires the payment of more than $140 million in monetary
owner
remedies, and imposes regulated industry bars and other relief.

CRS-33
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Anthony J. D’Amato, executive vice
Charged with aiding and abetting SCM’s violations and is barred from
president
association with any investment adviser, investment company, broker,
or dealer.
Thomas A. Hooker, compliance officer
Charged with aiding and abetting SCM’s and Strong’s violations by
failing, after he learned of Strong’s frequent trading, to follow up on a
directive to monitor the trading and ensure that it stopped. Hooker has
been barred from association with any investment adviser or
investment company.
Sunbeam Corp.
Al Dunlap, CEO
9/03/02 (S)
To settle SEC accounting fraud charges, the two agreed to pay fines
Knight Ridder
totaling $700,000 and were barred from serving as officers or
Tribune News
directors of public companies.
Service, 9/03/02,
Russell Kersh, CFO
p. 1.
Symbol Technologies, Inc.
6/3/04 (S)
The SEC charged Symbol Technologies with securities fraud and
SEC Press Release
related violations of the federal securities laws. Symbol agreed to
2004-74
settle the case without admitting or denying the allegations and will
pay a $37 million penalty for its conduct.
Tomo Razmilovic, president and CEO
6/3/04 (F)
The defendants engaged in a fraudulent scheme to inflate revenue,
earnings, and other measures of financial performance in order to
Kenneth Jaeggi, senior management
create the false appearance that Symbol had met or exceeded its
Brian Burke, senior management
financial projections.
Michael DeGennaro, senior management
Frank Borghese, senior management
Christopher DeSantis, executive

CRS-34
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
James Heuschneider, executive
Gregory Mortenson, executive
James Dean, executive
Robert Donlon, executive
Leonard Goldner, general counsel
Leonard Goldner manipulated stock option exercise dates to enable
certain senior executives, including himself, to profit unfairly at the
company’s expense.
TD Waterhouse Investor Services, Inc.
9/21/04 (S)
The SEC filed settled civil charges against TD Waterhouse Investor
SEC Press Release
Services, Inc., for making undisclosed cash payments to three
2004-133
investment advisers to encourage them to use TD Waterhouse for their
Kiely Financial Services, Inc.,
clients’ brokerage business. In settling the matter, TD Waterhouse
independent investment adviser
agreed to pay a $2 million penalty, among other remedies. The
commission also announced related fraud actions against the three
Rudney Associates, Inc., independent
investment advisers and their principals for their failures to disclose
investment adviser
the cash payments. Two of the investment advisers, Kiely Financial
Services and Rudney Associates, agreed to settle the charges without
Brandt, Delly & Simmons, LLC,
admitting or denying the findings.
independent investment adviser
Trump Hotels & Casino Resorts
1/16/02 (S)
Agreed to cease and desist from making misleading statements in pro
SEC Press Release
forma accounting releases.
2002-6
Tyco International
L. Dennis Kozlowski, CEO
9/12/02 (F)
SEC filed civil fraud charges seeking restitution of compensation and
SEC Press Release
loans and money penalties. The SEC charged that the three treated
2002-135
Mark H. Swartz, CFO
Tyco as their private bank, taking out hundreds of millions of dollars
of loans and compensation without telling investors.
Mark A. Belnick, chief legal officer

CRS-35
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Frank E. Walsh, Jr., director
12/17/02 (S)
Charged with concealing a $20 million finder’s fee received from
SEC Press Release
Tyco in connection with a 2001 merger. Walsh agreed to repay the
2002-177
$20 million to settle the charge.
UBS Financial Services Inc.
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $4,621,768.
UBS Warburg
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of research reports not based on principles of fair
2003-54
dealing and good faith, and for receiving undisclosed payments for
research. Paid fines totaling $80 million.
United Currency Group, Inc (UCG)
11/19/03 (F)
The SEC filed a complaint that alleged that Adam Swickle conducted
SEC Litigation
a fraudulent offering of United Currency Group, Inc.’s securities from
Release No.
May 2001 through December 2002 and raised approximately
18471
Adam Swickle, CEO
$774,000 from 21 investors.
U.S. Bancorp Piper Jaffray
4/28/03 (S)
Settled charges by New York state, NASD, NASAA, NYSE, and SEC
SEC Press Release
relating to issuance of research reports not based on principles of fair
2003-54
dealing and good faith, and for receiving undisclosed payments for
research. Paid fines totaling $32.5 million.
12/03/02 (S)
Paid a $1.65 million fine to settle SEC and NASD charges relating to
SEC Press Release
failure to retain e-mail records.
2002-173

CRS-36
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
U.S. Foodservice (subsidiary of Royal Ahold)
Michael Resnick, CFO
7/27/04 (F)
The SEC alleges that Resnick, Kaiser, Lee, and Carter engaged in or
SEC Press Release
substantially participated in a scheme to overstate the income of Royal
2004-100
Mark P. Kaiser, chief marketing officer
Ahold by $700 million or more for at least FY2001 and FY2002. The
complaint alleges that they grossly inflated reported profits and
Timothy J. Lee, executive vice president
induced numerous suppliers to submit false confirmations to the
company’s auditors in order to conceal their fraud.
William Carter, vice president
Van Wagoner Capital Management,
8/26/04 (S)
The SEC filed settled fraud charges against VWCM and Garrett Van
SEC Press Release
Inc. (VWCM)
Wagoner relating to their misstatement of the valuations of certain
2004-122
securities held by the Van Wagoner Funds. The settlement includes
an $800,000 penalty from Van Wagoner and VWCM, a seven-year
prohibition on Van Wagoner’s serving as an officer or director of a
mutual fund, and a seven-year restriction on certain of Van Wagoner’s
activities with the investment adviser (VWCM).
Garrett Van Wagoner, president
Vivendi Universal, S.A.
12/23/03 (S)
Settled charges by the SEC that included false press releases,
SEC Press Release
improper adjustments to earnings, and failure to disclose future
2003-184
financial commitments. Vivendi is required to pay a civil money
Jean-Marie Messier, CEO
penalty in the amount of $50 million. Messier is required to
relinquish his claim to a severance package of about $38 million and
to pay a civil money penalty of $1 million. Hannezo is required to
Guillaume Hannezo, CFO
disgorge $148,149 and pay a penalty of $120,000.

CRS-37
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Wachovia Securities, LLC
2/12/04 (S)
The SEC and the NASD settled enforcement actions for failure to
SEC Press Release
deliver mutual fund breakpoint discounts (volume discounts) during
2004-17
2001 and 2002. The firm agreed to compensate customers for the
overcharges and will pay a fine of $4,844,465.
Waste Management Inc.
Dean L. Buntrock, founder and CEO
3/26/02 (F)
The SEC charged the six with accounting fraud — a systematic
SEC Press Release
scheme to falsify and misrepresent the company’s financial results
2002-44
Phillip B. Rooney, chief operating officer
between 1992 and 1997. The SEC seeks disgorgement of ill-gotten
gains, money penalties, and bars the six from serving as officers or
James E. Koenig, CFO
directors of a public company.
Thomas C. Hau, controller
Herbert Getz, general counsel
Bruce D. Tobecksen, vice president
West Coast Power
12/19/02 (S)
CFTC settled charges that West Coast and Dynegy manipulated the
CFTC Release
price of natural gas by reporting false price and volume information.
4728-02
West Coast agreed to cease and desist from further violations and to
pay a $5 million fine.
WorldCom (became MCI on 4/20/04)
6/26/02 (F)
The SEC charged that WorldCom overstated its earnings between
SEC Litigation
5/19/03 (S)
1999 and 2002 as a result of improper accounting practices.
Release 18147
WorldCom agreed to pay a fine of $500 million, pending bankruptcy
court approval.
David F. Myers, controller
9/26/02 (F)
Barred from serving as an officer or director of a public company;
monetary penalties pending.

CRS-38
Date Civil Action
Company/Individual/Event
Filed (F) or
Charges
Source
Settled (S)
Buford Yates, Jr., director of accounting
10/02/02 (F)
Barred from serving as an officer or director of a public company;
suspended from practicing accounting before the SEC; monetary
penalties pending.
Betty Vinson, accountant
10/10/02 (F)
Suspended from practicing accounting before the SEC; monetary
penalties pending.
Troy M. Normand, accountant
10/10/02 (F)
Suspended from practicing before the SEC; monetary penalties
pending.
Scott D. Sullivan, CFO
3/2/04 (F)
Charged with engaging in a fraudulent scheme to conceal
SEC Press Release
WorldCom’s poor financial performance.
2004-25
Xerox
4/11/02 (S)
Agreed to pay a $10 million fine to settle SEC charges that it used
SEC Press Release
fraudulent accounting to overstate its earnings between 1997 and
2002-52
2000.
Paul A. Allaire, CEO
6/5/03 (S)
The six defendants agreed to pay more than $22 million in penalties,
SEC Press Release
disgorgement, and interest, without admitting or denying the SEC’s
2003-70
G. Richard Thoman, president
allegations of securities fraud and aiding and abetting Xerox’s
violations of the reporting, books and records, and internal control
Barry D. Romeril, CFO
provisions of the federal securities laws.
Philip D. Fishbach, controller
Daniel S. Marchibroda, asst. controller
Gregory B. Tayler, controller
Source: The government agencies’ press releases are accessible on their websites: SEC at [http://www.sec.gov/news/press.shtml], CFTC at [http://www.cftc.gov/cftc/cftcpressoffice.htm]
and FERC at [http://www.ferc.gov/press-room/press-releases.asp].
Abbreviations: NASD (National Association of Securities Dealers), NYSE (New York Stock Exchange), and NASAA (North American Securities Administrators Association)
a. Cases also resulted in criminal indictments, some followed by guilty pleas.