SEC says former Tvia execs inflated revenue

posted: 84 DAYS 14 HOURS AGO

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WASHINGTON -The Securities and Exchange Commission said Tuesday it has charged former executives at semiconductor company Tvia Inc. with improperly inflating the company's revenue.

The SEC said Santa Clara, Calif.-based Tvia's former vice president of worldwide sales, Benjamin Silva III, made side deals with customers — concealed from the company's executives and auditors — which caused the company to report millions of dollars in excess revenue.

An attorney for Silva did not immediately return a message seeking comment Tuesday afternoon.

The SEC also alleged that the company's former chief financial officer, Diane Bjorkstrom, played a role in the company's improper accounting as well. According to the SEC Bjorkstrom did this by allowing Tvia to recognize revenue on merchandise shipped to a customer weeks before the customer had agreed to accept it, and by failing to act on red flags surrounding Silva's misconduct.

Bjorkstrom agreed to settle the SEC's charges against her by paying a $20,000 penalty without admitting or denying the charges. An attorney for Bjorkstrom did not immediately return a message seeking comment.

The SEC's complaint says Silva's side deals illegally inflated Tvia's revenue by about $5 million from September 2005 through June 2006. This, the SEC charges, let Silva meet revenue targets at the company and for this he received an award of options to buy Tvia stock.

Silva, the SEC said, exercised and sold all of his available Tvia options for a profit of $300,000 before the fraud was discovered.

The SEC's complaint was filed in federal district court in San Jose, Calif.

2009-11-17 17:39:08