August 28, 2010 / 12:25 AM / 9 years ago

SEC sues ex-Dell accountants over fraud

NEW YORK (Reuters) - The U.S. Securities and Exchanges Commission on Friday sued two former top accountants of Dell Inc for manipulating financial statements to meet Wall Street earnings targets between 2001 to 2003.

The regulator said in its suit, filed at the U.S. District Court of the District of Columbia, that former Chief Accounting Officer Robert Davis, and former Assistant Controller Randall Imhoff had maintained a number of ‘cookie jar’ reserves — an improper accounting method in a bid to cover shortfalls in Dell’s operating results.

The SEC said the improper accounting led to Dell having to restate all its financial statements from 2003 to 2006.

Dell, the world’s third largest computer maker, last month agreed to pay $100 million to settle charges by the SEC that it had used hidden payments from Intel Corp and fraudulent accounting to meet analysts’ targets.

Under the settlement, Dell founder Michael Dell, along with former CEO Kevin Rollins, each agreed to pay $4 million. Former Chief Financial Officer James Schneider agreed to pay $3 million.

The cases are re: SEC v. Davis, No. 10cv1464, and SEC v. Imhoff, No. 10cv1465, U.S. District Court, District of Columbia.

Reporting by Yinka Adegoke; Editing by Richard Chang

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