A Westport man who is a former president and chief financial officer of Greenwich-based United Rentals Inc. pleaded guilty today to conspiring to falsify the company’s records, the U.S. Attorney’s Office said.
John N. Milne: Westporter also agrees to disgorge $6.25 million. File photo
John N. Milne, 50, a Canadian citizen living on Maple Avenue South, entered the plea before Senior U.S. District Judge Ellen Bree Burns in New Haven a day before he was scheduled to go on trial.
He faces a recommended sentence of 27 months in prison when he is sentenced Feb. 11, prosecutors said. He remains free on $1 million bond.
To resolve a separate civil action involving financial fraud charges brought by the U.S. Securities and Exchange Commission, Milne has agreed to disgorge $6.25 million, the commission said.
Authorities say Milne admitted that in 2003 he and others conspired to falsify the company’s records, including recording falsely inflated gains, related to payments made to settle obligations from minor sale-leaseback transactions to Westport-based Terex Corp.
In August, U.S. securities regulators approved an offer by Terex, the world’s third-largest maker of heavy earth-moving equipment, to pay an $8 million civil penalty to settle fraud charges related to United Rentals, an important customer.
Regulators alleged that Terex had aided and abetted a fraudulent accounting scheme at United Rentals involving sale-leaseback transactions.
The government alleged the transactions were structured to improve URI’s 2000 and 2001 financial results and allowed the company to recognize revenue prematurely and inflate the profit generated from the sales.
By paying the penalty, Terex neither admitted nor denied the U.S. Securities and Exchange Commission’s allegations, which also concerned the circumstance surrounding Terex’s 2006 restatement of its earnings for 2000 through 2004.
Last year, United Rentals paid $14 million to the SEC to settle charges related to the sale-leaseback transactions.
In April 2008, federal prosecutors said Milne used insider information when he sold 850,000 shares of United Rentals stock. (See WestportNow April 4, 2008)
They also said he deceived investors and filed bogus documents with the Securities and Exchange Commission to inflate the company’s stock price and personally benefit in an alleged conspiracy from 2000 to 2005.
The government indicted Milne on eight counts of conspiracy, securities fraud, insider trading and making false filings. At the time, the government said it was seeking forfeiture of more than $17 million which it said represented Milne’s proceeds from the alleged conspiracy and his insider trading.
Milne was with United Rentals from 1997 until his termination in 2005, according to the indictment. During that time, he also served as the company’s chief financial officer.
“This case demonstrates that corporate executives who engage in wrongdoing will be held accountable,” said U.S. Attorney Nora R. Dannehy. “Federal law enforcement is committed to investigating and prosecuting those who falsify company financial information in order to mislead the investing public.”
Added Kimberly K. Mertz, FBI Special Agent in Charge, “This guilty plea should serve as a warning to other corporate executives that the FBI is vigilant and is working with our federal partners to protect the integrity of our financial markets from manipulative business practices.”
No complaint, but I’ve noticed that every time someone in Westport is convicted of a crime it
Sex offenders are reported of their addresses, these types of crooks are raping this country of our money, so I am guessing they should be listed like sex offenders or terrorists. I think all those Wall Street guys who are now enjoying the billions of dollars in their bonuses with our bailout money should be listed too. We should all know who and where our money is really going to.
Brava, Norma. When is America going to wake up and see that this country is being eviscerated by these greedy financial types who produce nothing, invent nothing, but just take. At least the Robber Barons left us with railroads and industrial might. These guys leave nothing.
With all due respect Norma, that
Rich, could not have said it better myself – 100 pct agree with you.