Tuesday, June 7, 2005
Former Inso Corp. General Counsel Bruce Hill was convicted of one count of perjury in Boston related to his testimony before the SEC in an investigation of a sham transaction with a Malaysian purchaser of software. A press release issued by the U.S. Attorney's Office (here) states that Hill "played a pivotal role in arranging a series of deals that were designed to create the appearance that the Malaysian software distributor had paid Inso $3 million for software products that Inso had reported as sold during the third quarter of 1998. In sworn testimony before the SEC, Hill disavowed any knowledge about the preparation of a fraudulent certificate which purported to reflect approval by Inso's Board of Directors of the issuance of approximately $4 million in letters of credit that were used to create the appearance that Inso received $3 million in payment for the reported third quarter sale. At trial, the United States presented evidence that Hill had personally directed the preparation of the fraudulent certificate and approved its signing. Share prices for Inso's stock tumbled in February 1999, when the company publicly announced that it would need to restate its revenues from the first three quarters of 1998. The company is no longer publicly traded." The jury could not reach a verdict on five other counts, including securities fraud, wire fraud, making false statements to accountants, and a second perjury count.