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Aerosonic ex-CFO pleads guilty
He faces up to 10 years in prison for falsifying records to increase company earnings.
By CARRIE WEIMAR
Published March 7, 2007
TAMPA - The former chief financial officer of a Clearwater corporation that manufactures airplane parts pleaded guilty to wire fraud charges Tuesday. Eric J. McCracken, 40, faces a maximum of 10 years in prison when he is sentenced by U.S. District Judge Steven Merryday. A sentencing date has not yet been set. McCracken was employed by Aerosonic Corp., which is based in Clearwater. In 2004, the Securities and Exchange Commission filed civil charges against McCracken and former chief executive officer J. Mervyn Nabors, accusing them of using accounting tricks to inflate the company's earnings. Nabors settled with the SEC, agreeing to pay back his $210,200 bonus and a penalty of $50,000; McCracken was ordered to pay a $40,000 judgment. On Tuesday, he pleaded guilty to charges of wire fraud and conspiracy to commit wire fraud. According to his plea agreement, McCracken used his position as CFO to falsify inventory records and record fictitious revenue. The sham transactions included a deal in which Aerosonic sold 908 obsolete altitude counters to a Czechoslovakian company, then bought them back, putting them in inventory at an inflated price, according to court documents. The tricks gave the company a boost of more than $8-million to its pretax earnings from 1999 to 2003. The artificial results led to six-figure bonuses for McCracken and Nabors. According to the Tampa U.S. Attorney's office, McCracken inflated the figures at the direction of a co-conspirator, who was his supervisor. Steve Cole, a spokesman for the U.S. Attorney's office, would not confirm Nabors was the co-conspirator. However, in his plea agreement, McCracken said he would cooperate with the government and testify at any future court proceedings. Aerosonic stock closed Tuesday at $7.53 a share, up 2 cents. Carrie Weimar can be reached at (813) 226-3416 or cweimar@sptimes.com. Fast Facts: Aerosonic headquarters: Clearwater. Avionics Specialties Inc., a wholly owned subsidiary, is located in Charlottesville, Va. Full-time employees: 279 Key executives: David A. Baldini, chairman, CEO and president; Gary E. Colbert, CFO, executive vice president, secretary and treasurer Source: Yahoo Finance
[Last modified March 6, 2007, 23:07:15]
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