December 10, 2010 / 7:51 PM / 9 years ago

UPDATE 1-Ex-Vitesse Semiconductor execs indicted for fraud

(Adds details of charges)

WASHINGTON, Dec 10 (Reuters) - The founder and former chief executive of Vitesse Semiconductor Corp VTSS.PK, Louis Tomasetta, and former executive vice president Eugene Hovanec have been indicted for securities fraud, the U.S. Justice Department said on Friday.

They were also accused of making false entries in the books and records of the company, of making false filings with the Securities and Exchange Commission and of conspiracy for a scheme to manipulate the company’s financial statements.

Prosecutors charged the two executives of a scheme between 2001 and 2006 to deceive Vitesse’s auditors and investors about its financial condition and how its business was performing. They also backdated stock options and failed to properly account for products that were returned, they said.

They are due to appear in court later on Friday.

Two other former company executives, the past chief financial officer Yatin Mody and former accounting director Nicole Kaplan, pleaded guilty in the last two weeks for their role in the scheme, the Justice Department said.

Vitesse’s shares were delisted from Nasdaq in June 2006. They were trading up 11 cents or 2.5 percent at $4.47 on the pink sheets in afternoon dealings. (Reporting by Jeremy Pelofsky, editing by Gerald E. McCormick)

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