Former Nortel boss dragged back into limelight

Thu Jun 19, 2008 2:17pm EDT
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By Susan Taylor

OTTAWA (Reuters) - Former Nortel Networks boss Frank Dunn was a low-key, numbers man who shunned the limelight as CEO of the telecom equipment maker, but now he's back at center stage facing new criminal charges from an accounting scandal that's years old.

The Royal Canadian Mounted Police on Thursday accused Dunn and two other former senior executives of fraudulently misstating financial results in 2002 and 2003.

It marks another round in the one-time university football player's fight to prove that problems under his tenure were innocent accounting errors rather than an intentional plan to cook the books.

Nortel sacked Dunn and several finance executives in 2004 after discovering that it needed to restate earnings to fix bookkeeping mistakes.

A company review alleged that Dunn directed management to apply accounting policies that did not meet U.S. standards to try and reach profit targets and trigger bonuses.

The accounting crisis led to regulatory and criminal probes along with investor lawsuits, which the company has paid millions of dollars to settle.

Dunn, 54, still faces charges from the U.S. Securities and Exchange Commission and the Ontario Securities Commission.

Nortel's chief financial officer before his promotion to CEO in 2001 - a time when no one else wanted the job - the steely-eyed Dunn proved a hard-driving leader.   Continued...

<p>Former Nortel Chief Executive Frank Dunn comments on the company's results after their annual general meeting in Ottawa, April 24, 2003. REUTERS/Jim Young</p>