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Lernout & Hauspie Settles SEC Charges

October 11, 2002|Bloomberg News

REGULATION

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Lernout & Hauspie Speech Products, a Belgium- and U.S.-based company that had operations in five countries, said it has reached a settlement with the Securities and Exchange Commission on charges of inflating revenue by hundreds of millions of dollars.

The company, a developer of speech and language technologies that is being liquidated, lost $8.6 billion in market value when its stock fell 99% after its scheme was reported in the news in 2000, the SEC said.

Lernout created bogus customers, booked circular transactions with shell companies and recorded loans as sales from 1996 to 2000, the SEC alleged.

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