WishX Posted July 31, 2002 Share Posted July 31, 2002 Ex-Cisco exec took $50 million in fraud By Reuters July 31, 2002, 12:20 PM PT http://news.com.com/2100-1033-947454.html A former Cisco Systems executive has pleaded guilty to illegally transferring some $50 million in company stock and funds to an offshore shell account in the Bahamas, federal law enforcement officials said Wednesday. Assistant U.S. Attorney Matthew Jacobs said Robert Gordon pleaded guilty Tuesday to two counts of wire fraud and one count of insider trading in the scheme that defrauded the networking giant out of tens of millions of dollars. Gordon faces up to 20 years in prison but will likely receive a shorter term because of federal sentencing guidelines, Jacobs added. Sentencing is scheduled for Oct. 29. "The maximum penalties would be 10 years for wire fraud and 10 for insider trading," Jacobs said. Gordon was indicted in May 2001 in connection with an alleged 1999 stock scheme in which he used his position as vice president to illegally transfer Cisco-owned stock and funds to an offshore shell account. Prosecutors said Gordon placed more than 30,000 shares of Internet Security Services Group--a company bought by Cisco--into a Bahamas-based shell company that he created called Cisco Systems, which has no connection with San Jose's Cisco. The government also charged Gordon with fraudulently inducing Cisco to put $15 million into Spanlink, a Cisco-affiliated start-up company, in a deal allegedly engineered to provide him with a personal profit of up to $10 million. Gordon, who was fired by Cisco in April 2001 after an internal investigation mounted by the network gear maker revealed the problems, also illegally traded stock using inside information, prosecutors said. Link to comment Share on other sites More sharing options...
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