A federal jury has cleared Former Delphi CEO J.T. Battenberg of the most serious allegations levied against him by the Securities and Exchange Commission. The SEC had charged both Battenberg and former Delphi accountant Paul Free with a variety of offenses, the most severe of which were fraud charges associated with misrepresenting a $237 million payment to General Motors. On Thursday, the jury cleared Battenberg of four of the most severe charges, but found him guilty of failing to maintain accurate books or records and misleading his accountants.
Meanwhile, the jury found that Free was guilty of violating rules associated with a smaller transaction that Delphi made with a bank.
The SEC had accused Battenberg of misreporting the payment to General Motors in order to make the company’s bottom line appear stronger to investors than it actually was. The move was believed to have been made to secure larger bonuses for the CEO and other executives.
[Source: Reuters]
Follow-up: Ex-Delphi CEO cleared of fraud, convicted of lesser charges originally appeared on Autoblog on Sat, 15 Jan 2011 14:15:00 EST. Please see our terms for use of feeds.
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According to the Detroit Free Press, the Securities and Exchange Commission has accused former Delphi CEO J.T. Battenberg III of intentionally working to hide his company’s financial situation from investors. On Tuesday, an SEC lawyer told the jury in Battenberg’s trial that the ex-Delphi boss made the company’s financial numbers look better than they were in order to secure larger bonuses. The SEC sued both Battenberg and Paul Free, the former Chief Accounting Officer for Delphi, and several other former executives in 2006 for fraudulent accounting. Delphi entered into bankruptcy protection in 2005.