A second former executive of
is facing civil and criminal fraud charges in connection with accounting transgressions under the security software maker's previous management.
Securities and Exchange Commission
announced Wednesday it has filed civil fraud charges in U.S. District Court against Prabhat K. Goyal, the former CFO of Network Associates until 2000. The SEC alleges that he overstated the company's revenue and earnings from the second quarter of fiscal 1998 to the fourth quarter of fiscal 2000, the agency announced Wednesday.
The complaint also charges that Goyal has sold stock while possessing material non-public information regarding the financial fraud at Network Associates.
The U.S. attorney for the Northern District of California announced criminal charges against Goyal arising from the same conduct charged in the commission's complaint
The charges against Goyal come about one year after the SEC and U.S. attorney's office took a similar move against Terry W. Davis, a former VP and corporate controller at Network Associates.
The charges against Goyal include using a subsidiary to repurchase products from distributors and making secret payments to distributors to induce them to hold inventory and buy more products. The SEC is seeking disgorgement of gains in the form of salary, bonuses and sales of stock as well as civil money penalties.
Network Associates, now under new management, has been struggling to break out from the cloud of an SEC investigation and financial restatements. Shares of the stock recently declined 20 cents, or 1.2%, to $16.72.