BI’s Article search uses Boolean search capabilities. If you are not familiar with these principles, here are some quick tips.
To search specifically for more than one word, put the search term in quotation marks. For example, “workers compensation”. This will limit your search to that combination of words.
To search for a combination of terms, use quotations and the & symbol. For example, “hurricane” & “loss”.
NEW YORK--A New York federal court has ordered Brightpoint Inc.'s former director of risk management, Timothy Harcharik, to pay $50,000 in fines for his role in a fraudulent finite-risk deal struck in 1998 between Brightpoint and American International Group Inc., the Securities and Exchange Commission said Monday.
In addition to ordering civil penalties, the court enjoined Mr. Harcharik for a period of five years from future violations of antifraud and other violations of federal securities laws, the SEC said in a statement.
The final judgment entered against Mr. Harcharik follows a four-day trial in May that found him liable of aiding and abetting fraud in the Brightpoint-AIG deal. The jury did not find Mr. Harcharik liable for two of five total charges brought against him by the SEC. The charges he was not found liable for were related to SEC rules governing, among other things, securities trading and misrepresentations in certain documents.
The civil case was the first finite risk-related securities case to go to trial.
AIG in 2003 paid $10 million to settle charges by the SEC over a 1998 finite transaction with the Plainfield, Ind.-based mobile telephone distributor.
The SEC had charged that New York-based AIG unit National Union Fire Insurance Co. of Pittsburgh, Pa., provided Brightpoint with an insurance contract that did not involve any actual risk transfer. This contract allowed Brightpoint to claim an insurance receivable in its financial statements, which led to an overstatement of earnings, the SEC charged.
AIG did not admit any wrongdoing as part of the settlement.
"I am gratified with this result. Cracking down on the abuse of so-called finite insurance and reinsurance to cook the books of public companies has been a priority for us," said Mark K. Schonfeld, director of the SEC's New York Regional Office.
The final judgment entered against Mr. Harcharik concludes the SEC's litigation in the Brightpoint probe, the agency said.
Previously, all of the defendants in the case--including Brightpoint's former chief financial officer, Phillip Bounsall, and former chief accounting officer, John Delaney--except Mr. Harcharik had agreed to settle the commission's charges.