Date: July 11, 2002
Source: News Room
Former executives at Waste Management Inc. (NYSE:WMI) may challenge Securities and Exchange Commission fraud allegations on the grounds that only one commissioner voted in the case. Earlier this month, an SEC administrative law judge threw out a case against accountants Ernst & Young (ERNY.UL) because only one commissioner voted to approve the case instead of the required votes by at least two commissioners. In March, the SEC filed a civil lawsuit against Dean Buntrock, founder and former chief executive of Waste Management and five other executives, alleging they inflated profits by $1.7 billion to meet earnings targets during the 1990s while profiting $29 million from bonuses and insider trading. The independent auditor for Houston-based Waste Management was Arthur Andersen (ANDR.UL), which was fined $7 million after a four-year investigation into its audit role in the company's accounting. In his attempt to block the SEC lawsuit, Buntrock filed his own lawsuit against the agency one month before the SEC sued the former executives, alleging conflict of interest. Buntrock alleged that two officials now at the SEC investigating him and the others were hired by his successor at Waste Management as consultants to look into the company's finances.