SEC accuses Culver City e-commerce firm of fraud

The Securities and Exchange Commission on Friday sued Culver City-based Meridian Holdings Inc. and two people connected with the company, alleging that they fraudulently used a $30-million default judgment in a lawsuit to boost earnings.

The SEC said financial statements filed with the e-commerce company’s 2004 second- and third-quarter reports showed significant gains when the company should have reported losses. Its stock jumped on the reports, the SEC said.

The complaint names Anthony C. Dike, 52, Meridian’s chief executive at the time, and Michelle V. Nguyen, 48, identified as its former principal financial officer.

Dike and Nguyen are alleged to have prepared misleading financial statements by booking the $30-million judgment “when neither had any reasonable basis to believe the judgment was collectible,” the SEC said.

Robert Meylan, a lawyer for Meridian and Dike, could not be reached for comment.

Mark Byrne, Nguyen’s attorney, disputed the charges against her, saying she was never an officer of the company and did not play a major role in the reporting of financial results.

“Her role in the alleged offenses has been blown way out of proportion, and we’re dismayed and frustrated that it’s gone this far,” Byrne said.