RealTime IT News

Accounting Scandal: Liberate, Charter Fire Execs

Liberate Technologies, an interactive TV software firm based in San Carlos, Calif., announced the firing of chief operating officer Donald Fitzpatrick after an investigation into various accounting transactions. Fitzpatrick's firing comes just days after Charter Communications dismissed CFO Kent Kalkwarf and COO David Barford in the midst of a federal grand jury probe of its accounting practices.

Liberate also said chief executive Mitchell Kertzman, who was due to give up the CEO title and become executive chairman by yearend, would now retain the posts to oversee the filing of the amended financial reports.

Liberate Technologies' Fitzpatrick had previously been placed on administrative leave pending the accounting investigations. The company now plans to restate its fiscal 2002 annual report once the accounting probe is completed.

Liberate was due to issue its annual report in December 2000 but that has been pushed back and the company said no date had been fixed for the completion of the accounting audit. Last month, Liberate said a preliminary audit showed as much as 11 percent of revenue reported during the last year might be questionable.

At St Louis-based Charter Communications, the story was the same. In the midst of a federal grand jury probe into its accounting procedures, the cable television firm announced that fired CFO Kent Kalkwarf would be replaced on an interim basis by VP Steven Schumm on an interim basis. Ousted CFO David Barford, who was forced on leave in October, will be replaced by VP of operations Maggie Bellville.

Accounting scandals at many major U.S. firms hogged the headlines in 2002. Corporate malfeasance forced energy trading giant Enron and WorldCom into bankruptcy proceedings while the Securities and Exchange Commission's (SEC) investigators have been busy investigating irregularities at several firms, particular in the telecommunications space.