Eight former executives of AOL have been
accused with illegally inflating the internet company's ad revenue by a cool
billion dollars.
In civil lawsuits presented Monday, the US Securities and Exchange
Commission claimed that the executives oversaw or contributed to fraudulent
transactions in which AOL Time Warner gave advertisers money to buy ads they
didn't want or need.
The scheme allegedly inflated AOL's ad revenues and pumped up its stock price,
giving the internet pioneer the leverage to buy Time Warner for 184 billion
dollars in 2001 to form the world's largest media company.
That deal later turned out to be a fiasco, with the combined value of the
companies dropping from a high of more than 280 billion dollars to 57 billion
dollars currently.
Four of the accused former directors have agreed to settle the lawsuits for a
total of 8 million dollars in fines, without admitting fault.
Time Warner agreed in late 2004 and early 2005 to pay 300 million dollars in a
settlement of civil fraud charges with the SEC and 210 million dollars to
resolve charges of criminal securities fraud in a separate investigation by the
US Justice Department.
Time Warner also agreed to restate three years of financial
results and to open its books to an independent auditor, dpa
reported.
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