Former Premier Laser CFO Will Pay $10,000 SEC Fine
A former executive of troubled Premier Laser Systems Inc. was accused by federal authorities of inflating the Irvine company’s revenue nearly three years ago.
Michael L. Hiebert, former chief financial officer, agreed to pay a $10,000 fine and to refrain from future violations, the Securities and Exchange Commission said Wednesday. He neither admitted nor denied any wrongdoing.
The SEC complaint said Hiebert improperly logged $2.4 million for a laser sale that never took place, inflating the company’s total revenue by a third for the fiscal third quarter ended Dec. 31, 1997.
At the time, the laser developer also recorded its first quarterly profit, which later was restated to reflect a loss of nearly $100,000 for the period.
The questionable accounting involved an agreement with Henry Schein Inc. to market Premier’s lasers. Although Schein entered into a nonbinding agreement to market the lasers, it never actually placed an order to buy them, according to the SEC complaint.
Hiebert also violated Premier’s internal control process by recording a sale without first obtaining a signed purchase order, the complaint said. An unnamed executive, who is now dead, allegedly assured Hiebert that the sale was legitimate, the complaint said.
Hiebert declined to comment Wednesday.
The SEC also said the company agreed to refrain from violating anti-fraud and reporting provisions of federal securities laws. The company shut down operations in March and filed for bankruptcy reorganization.
After Premier slashed its revenue estimates in 1998 and restated its financial results, disgruntled shareholders took legal action. In January 1999, the company agreed to pay nearly $14 million to settle 19 class-action lawsuits. Premier denied any wrongdoing.
On Tuesday, Premier announced that it hoped to liquidate its remaining assets within the next four months. The company also said it has agreed to sell the laser technology that once helped make the company the darling of Wall Street. The laser was heralded as a breakthrough in dentistry because of its potential for eliminating many painful drilling procedures.
Premier’s stock closed Wednesday at 40 cents, down 25 cents a share, in over-the-counter trading.
