Ex-Homestore CEO Found Guilty

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A Los Angeles jury on Thursday found Homestore Inc.’s former chief executive, Stuart Wolff, guilty of defrauding investors by inflating advertising revenue at the Internet real estate firm.


The federal court jury, which began deliberating on Wednesday, convicted Wolff of conspiracy to violate securities laws, insider trading, and falsifying the company’s records.


Prosecutors said Wolff, 43, and other executives used sham transactions to inflate company sales, boosting the Westlake Village-based Homestore’s bottom line in 2001 to meet Wall Street expectations.


The evidence against Wolff was overwhelming,” U.S. District Judge Percy Anderson said, denying bail. Wolff could face as much as 185 years in prison when he is sentenced Sept. 11. Wolff’s lawyer, Lawrence Barcella, told Bloomberg News that his client planned to appeal the verdict.


Peter Tafeen, Homestore’s former vice president of business development, pleaded guilty earlier this year in the case. Former Chief Financial Officer Joseph Shew and former Chief Operating Officer John Giesecke pleaded guilty in September 2002 and testified against Wolff.


In 2003 Homestore settled an investor suit over the transactions for $93 million in cash and stock.

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