U.S. Wireless CEO Replaced in Probe

U.S. Wireless Corp., a San Ramon, Calif.-based provider of location-related information for mobile services, has replaced Oliver Hilsenrath as its chairman and chief executive, after an internal audit revealed “various irregularities” in payments of cash and stock to possible affiliates of the officer.

The company said over the weekend that it has not yet determined whether the payments have had a material effect on the company’s past financial statements.

In response to his removal, Hilsenrath released a statement that “compensation” was “paid to a number of bankers, agents and consultants” who had supported U.S. Wireless through financing and “creating important relationships” for the company when other support was not available. He vowed to continue to be a “great supporter of” and “an active member of the board of directors” of the company.

U.S. Wireless also said it named Dennis Francis, a member of the board, as chief executive and independent consultant Louis Golm as chairman.

An investigation by the audit committee of the board of directors uncovered “insufficient documentation” on cash payments and issuances of stock and stock options to possible affiliates of Hilsenrath and another former executive officer of the company, U.S. Wireless said in a statement.

No evidence was found linking any other employee, officer or board member to any improper action, it said.

The audit committee conducted its investigation with the assistance of outside legal counsel and an independent public accountant who “had no prior affiliation with the company,” the statement said.

In its latest annual report filed with U.S. regulators in June of last year, U.S. Wireless listed BDO Seidman as its independent auditor.

On Friday, U.S. Wireless shares closed at $2.91, down 4 cents, on Nasdaq.