LAWFUEL – The Litigation Newswire – Nortel Networks Corp. has agreed to pay $35 million and consent to quarterly oversight to settle a fraud-related investigation by U.S. regulators, the company said Monday.
The settlement stems from a 2004 accounting scandal in which former Nortel executives concealed the company’s deteriorating financial condition and inflated reported results.
Frank Dunn, the chief executive at the time, and three other senior managers were fired for their role in what the Securities and Exchange Commission termed “a pattern of fraud.”
Under the agreement with the SEC, Nortel (NT:nortel networks corp new com plans to pay the $35 million as a civil penalty and to consent to certain injunctions.
In addition, the Ontario-based networker has agreed to provide the U.S. securities agency with quarterly reports detailing the steps it’s taken to strengthen the process by which it reports financial results.
Nortel has already reached a settlement with Canadian regulators as well as shareholders who filed several class-action suits. The company said the series of settlements it’s reached will allow Nortel “to focus on the future.”