Gemstar’s Ex-CFO Settles Charges

The former chief financial officer of Gemstar-TV Guide International Inc. will pay more than $1.3 million to settle civil charges that she participated in a scheme to inflate the company’s revenue, the Securities and Exchange Commission said Tuesday.

The penalty against Elsie Leung is the largest yet to be levied upon any of the executives accused of playing a role in a $250-million accounting fraud that allegedly spanned more than three years, starting in June 1999. The Hollywood-based technology and media company’s former general counsel and former co-president have already settled with the SEC.

“Our settlement will punish Leung’s misconduct and help protect investors from future harm by ensuring that she never again can serve as an officer or director of a public company,” said Randall Lee, director of the SEC’s Pacific regional office.

Leung was accused of directing and approving the firm’s decision to improperly report revenue from its heavily promoted interactive TV program guide, which lets viewers easily scan television shows. She also was accused of signing false representation letters to Gemstar’s auditors regarding the structure of certain transactions.

Stanley Arkin and David Shapiro, attorneys for Leung, couldn’t be reached for comment. Leung agreed to give up $600,000 plus interest, representing bonus money she earned during the relevant period, and pay a $750,000 civil penalty.

The SEC’s charges against Henry Yuen, Gemstar’s former chairman and chief executive, are pending and await a court decision. Gemstar is now controlled by Rupert Murdoch’s News Corp.