Pressure Grows for Webster to Resign
William H. Webster, designated chief of the nation’s new accounting oversight board, has called an initial meeting of the panel for next Wednesday. But more questions arose Thursday about whether he can hang on that long.
Webster faced new pressure to resign after accounting firm BDO Seidman released documents indicating that he took part in a July 2001 conference call in which the auditors warned of poor financial controls at U.S. Technologies Inc.
Webster, then a director of the company and head of its audit committee, last week told the Washington Post that he didn’t recall receiving the warnings. U.S. Technologies, which since has been sued by investors for fraud, fired BDO Seidman a month after the conference call.
BDO Seidman earlier this week filed suit against U.S. Technologies, contending that Webster, in the Post, had made “false and misleading statements” about his awareness of financial problems at the company.
On Thursday, BDO Seidman released documents it said were sent to members of the audit committee before the conference call, raising concerns about U.S. Technologies’ financial controls.
Webster could not be reached for comment.
BDO Seidman’s retort triggered new calls for Webster to withdraw from the accounting-panel post, two days after the resignation of Securities and Exchange Commission Chairman Harvey L. Pitt, who had championed Webster’s appointment.
The AFL-CIO, which seeks a stronger role in corporate governance issues, Thursday called for Webster to resign.
Webster’s role at U.S. Technologies came to light after he was confirmed Oct. 25 by the SEC as head of the accounting panel. Webster, 78, said he had told Pitt about the company before the SEC vote, but Pitt apparently did not advise the four other SEC commissioners -- subsequently triggering a political firestorm.
Webster has sent agendas for next week’s organizing meeting of the panel to his four fellow appointees.
“I’m planning to go unless somebody tells me not to,” said one designee, who asked not to be identified.
The board, created by Congress to adopt corporate bookkeeping standards and to monitor and discipline accounting firms, still has no headquarters, no budget and no staff.
When asked Thursday at a news conference if Webster should quit, President Bush praised the former FBI and CIA director’s service to the nation, but also said he wanted to see an SEC inspector general’s report into the panel selection process.
