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Ex-CFO of Motorcar Agrees to Guilty Plea

September 19, 2002|DEBORA VRANA | TIMES STAFF WRITER

The former chief financial officer of Motorcar Parts & Accessories Inc. agreed Wednesday to plead guilty to criminal charges that he sharply inflated the Torrance firm's earnings in 1997 and 1998.

The Securities and Exchange Commission and the U.S. attorney's office in Los Angeles said Peter Bromberg, 38, falsified Motorcar's financial performance for those two years. Bromberg, who left the firm in May 1999, will be arraigned Sept. 30 in Los Angeles.

The SEC said Motorcar, which remanufactures and distributes replacement alternators and starters for cars and trucks, has settled similar civil charges with the agency. Civil charges brought by the SEC against Bromberg are pending.

"This is a small company, but our message is very clear: We take financial reporting very seriously," said Randall Lee, director of the SEC's Pacific region. "In the cases of intentional misconduct, we will work with criminal authorities to bring appropriate charges."

Motorcar's shares plunged in 1999 after the company said it found accounting irregularities and restated its results.

The SEC's complaint alleged that Motorcar and Bromberg overstated pretax earnings by $3.39 million in 1997 and $3.57 million in 1998 and hid returned goods at off-site trailers so company auditors couldn't track them.

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