Former Waste Management Execs Settle SEC Suit

Date: October 21, 2003

Source: News Room

Two former top executives at Waste Management Inc. (NYSE: WMI) will pay $4.2 million to settle Securities and Exchange Commission allegations they profited from insider trading. Former President Rodney Proto and former Chief Financial Officer Earl DeFrates agreed to the settlement without admitting or denying the agency's claims. The SEC said the managers sold Waste Management stock in mid-1999 with the knowledge that the firm had inflated its quarterly income with unreported one-time gains. Regulators have estimated the stock received a 17% boost, increasing quarterly earnings by nine cents a share. Proto agreed to repay $3.7 million in penalties, interest and losses avoided by the sale, while DeFrates will pay $482,779. Both men also will be barred from serving as a corporate officer or director for five years. Bruce Snyder Jr., Waste Management's former chief accounting officer, was charged with insider trading in a separate SEC lawsuit, which charges he engaged in insider trading and signed off on a misleading quarterly report the company filed in December 1999. The company noted in a press release that it has made significant changes to both its leadership team and its business operations since 1999.
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