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Top Two Officers of Step Down

Internet: Resignations come after the Web auction site's auditor quits, citing management problems.

March 30, 2000|From Bloomberg News

IRVINE — The top two executives at quit after its outside auditor resigned, citing a loss of confidence in management and a lack of adequate internal controls and management oversight.

Dominic Magliarditi stepped down as president, chief operating officer and chief financial officer, and Steven Rebeil quit as chief executive but will remain as co-chairman of the Internet auction site.

Separately, 2TheMart said it agreed to buy Inc., an Internet site that pays members to Web surf and shop, for an unspecified amount of stock.

The company said Ian Simpson, GoToWorld's chief executive, would become president, chief executive and co-chairman of 2TheMart.

Grant Thornton, the outside auditor, informed the company of its resignation on March 22, the company said in a filing with the Securities and Exchange Commission.

Grant Thornton explained it would "no longer be able to rely on management's representations," 2TheMart said. It added that Grant Thornton also said it "does not have adequate internal controls or the appropriate level of management or board oversight."

In July, the company's first auditor, Deloitte & Touche, ended its relationship with 2TheMart a month after it was hired.

With just two days remaining before the company's deadline to file its 1999 audited financial statements with the SEC, Corbin & Wertz was hired to replace Grant Thornton to conduct the audit.

The company said the resignations of Grant Thornton and the executives weren't related.

Three years ago, the Nevada Gaming Commission denied a gaming license application submitted by Magliarditi and Rebeil. It found they lied to state investigators and weren't qualified to be officers or directors of a publicly traded company.

Shares of 2TheMart closed up 6 cents at $4.94 in over-the-counter trading.

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