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Delphi's Cashless Settlement

The bankrupt auto supplier will not pay a fine in settling with the SEC.
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Securities regulators charged

Delphi

and several former top executives at the auto parts supply company with engaging in a series of schemes to misstate the now-bankrupt company's financial situation.

In all, the

Securities and Exchange Commission

filed civil fraud charges against the Troy, Mich.-based company and 13 individuals, including the company's former chairman and CEO, J.T. Battenberg III.

The company reached a non-monetary settlement with the SEC. Regulators decided not to impose a fine on the company for the alleged fraudulent accounting, because Delphi had cooperated with the investigation.

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"Despite engaging in widespread fraudulent conduct, Delphi took significant remedial steps and cooperated extensively with the Commission's investigation,'' says SEC Associate Director Fredric Firestone. "The Commission considered Delphi's remediation and cooperation, among other things, in deciding not to impose a penalty."

Also settling were six of the individual defendants, including former CFO Alan Dawes. In settling with regulators, Dawes agreed to be barred from serving as an officer or director of another public company for five years and to pay $553,000 in restitution and fines.

A year ago, Delphi, which was spun off by

General Motors

(GM) - Get General Motors Company (GM) Report

in 1999, filed for bankruptcy and announced it was closing 21 or its 29 manufacturing plants. Before filing for bankruptcy, the company acknowledge that it had engaged in improper accounting and restated several years of earnings.

The SEC charges that Delphi "engaged in multiple schemes that resulted in Delphi materially misstating its financial condition and operating results" from 2000 through 2004. The various schemes inflated the company's revenue by hundreds of millions of dollars.