Ex-Execs Plead Guilty in Vitesse Backdating CaseFriday, August 16, 2013
Two former top Vitesse Semiconductor Corp. executives have pleaded guilty in federal court to obstructing justice in connection with a stock backdating scheme.
Louis Tomasetta, 64, of Ojai, and Eugene Hovanec, 61, of Westlake Village, face up to five years in prison when sentenced in U.S. District Court in New York in November.
Tomasetta served as chief executive and Hovanec as chief financial officer and vice president of the Camarillo semiconductor company until they were fired in May 2006 during an investigation into the inappropriate awarding of stock options.
They entered guilty pleas on Thursday to a charge of conspiring to alter, falsify or destroy documents in the course of a federal investigation after prosecutors decided to pursue the case a third time.
“With today’s guilty pleas, Louis Tomasetta and Eugene Hovanec answer as felons for their attempts to use their positions of power to obstruct an investigation they expected the SEC to conduct into their company’s accounting practices,” said Manhattan U.S. Attorney Preet Bharara said in a prepared statement.
Prosecutors said Tomasetta, Hovanec, and Yatin Mody, 50, of Westlake Village, the chief financial officer prior to Hovanec, conspired in 2006 to create fake minutes of meetings from 2001 of the Vitesse board of director’s compensation committee related to authorizing option grants.
Mody pleaded guilty in December 2010 to securities fraud, making false entries in the financial records of a corporation and conspiracy. He awaits sentencing.
Vitesse was never charged criminally, but paid a $3 million civil penalty to Securities and Exchange Commission in December 2010.
Shares lost 3 cents, or more than 1 percent, to close at $2.61 on the Nasdaq.