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U.S. Securities and Exchange Commission

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 50932 / December 27, 2004

Accounting And Auditing Enforcement
Release No. 2157 / December 27,, 2004

Admin. Proc. File No. 3-11783


In the Matter of

LAURENCE D. COHEN (CPA),

Respondent.



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ORDER INSTITUTING ADMINISTRATIVE PROCEEDINGS PURSUANT TO RULE 102(e) OF THE COMMISSION'S RULES OF PRACTICE, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS

I.

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted against Laurence D. Cohen ("Respondent" or "Cohen") pursuant to Rule 102(e)(3)(i) of the Commission's Rules of Practice.

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer of Settlement (the "Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, and the findings contained in Section III.3 below, which are admitted, Respondent consents to the entry of this Order Instituting Administrative Proceedings Pursuant to Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions ("Order"), as set forth below.1

III.

On the basis of this Order and Respondent's Offer, the Commission finds that:

1. Cohen, age 40, is and has been a certified public accountant licensed to practice in the Commonwealth of Massachusetts. He served as corporate controller at Robotic Vision Systems, Inc. ("Robotic") from June 1999 to April 2003.

2. Robotic is a Delaware corporation currently based in Nashua, New Hampshire. During the relevant time period, Robotic's corporate offices, as well as the offices of its Acuity CiMatrix ("ACIM") division, were located in Canton, Massachusetts. Robotic's ACIM division manufactures bar code reading systems and computer systems that inspect products. At all relevant times, Robotic's common stock was registered with the Commission pursuant to Section 12(g) of the Exchange Act and was traded on the NASDAQ National Market System, and the company was required to file annual and quarterly reports with the Commission pursuant to Section 13(a) of the Securities Exchange Act of 1934 ("Exchange Act").

3. On November 18, 2004, the Commission filed a complaint against Cohen in SEC v. Baker, et al. (Civil Action No. 04-12444-DPW). On November 29, 2004, the court entered an order permanently enjoining Cohen, by consent, from future violations of Sections 10(b), 13(a), 13(b)(2)(A), 13(b)(2)(B) and13(b)(5) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1, 13a-13, 13b2-1 and 13b2-2 thereunder, in the civil action entitled SEC v. Baker, et al., Civil Action No. 04-12444-DPW, in the United States District Court for the District of Massachusetts. Cohen was ordered to pay a $40,000 civil money penalty, and barred for a period of five years from serving as an officer or a director of any issuer which has a class of securities registered pursuant to Section 12 of the Exchange Act or which is required to file reports pursuant to Section 15(d) of the Exchange Act.

4. The Commission's complaint alleged, among other things, that Robotic made material overstatements of revenue and net income resulting from improper recognition of revenue at the ACIM division. Between December 1999 and September 2000, ACIM entered into approximately 36 purported sales to its customers and distributors that contained non- standard terms that deferred, conditioned or even negated their obligation to pay ACIM for the products. ACIM recognized approximately $4.74 million of revenue on the purported sales. This improper recognition of revenue constituted a failure to comply with generally accepted accounting principles ("GAAP"). The complaint alleged that, among other things, Cohen participated in the preparation of Robotic's financial statements and knew, or was reckless in not knowing, that the financial statements contained materially false or misleading revenue figures arising out of the ACIM transactions with non-standard terms. The complaint also alleged that Cohen failed to disclose to Robotic's outside auditors relevant information about the transactions with non-standard terms, and that Cohen violated and aided and abetted violations of the books and records and internal controls provisions of the Exchange Act.

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to impose the sanction agreed to in Respondent Cohen's Offer.

Accordingly, it is hereby ORDERED, effective immediately, that:

A. Respondent is suspended from appearing or practicing before the Commission as an accountant.

B. After five years from the date of this order, Respondent may request that the Commission consider his reinstatement by submitting an application (attention: Office of the Chief Accountant) to resume appearing or practicing before the Commission as:

  1. a preparer or reviewer, or a person responsible for the preparation or review, of any public company's financial statements that are filed with the Commission. Such an application must satisfy the Commission that Respondent's work in his practice before the Commission will be reviewed either by the independent audit committee of the public company for which he works or in some other acceptable manner, as long as he practices before the Commission in this capacity; and/or
     
  2. an independent accountant. Such an application must satisfy the Commission that:
     
    1. Respondent, or the public accounting firm with which he is associated, is registered with the Public Company Accounting Oversight Board ("Board") in accordance with the Sarbanes-Oxley Act of 2002, and such registration continues to be effective;
       
    2. Respondent, or the registered public accounting firm with which he is associated, has been inspected by the Board and that inspection did not identify any criticisms of or potential defects in the Respondent's or firm's quality control system that would indicate that the Respondent will not receive appropriate supervision or, if the Board has not conducted an inspection, has received an unqualified report relating to his, or the firm's, most recent peer review conducted in accordance with the guidelines adopted by the former SEC Practice Section of the American Institute of Certified Public Accountants Division for CPA Firms or an organization providing equivalent oversight and quality control functions;
       
    3. Respondent has resolved all disciplinary issues with the Board, and has complied with all terms and conditions of any sanctions imposed by the Board (other than reinstatement by the Commission); and
       
    4. The Respondent acknowledges his responsibility, as long as Respondent appears or practices before the Commission as an independent accountant, to comply with all requirements of the Commission and the Board, including, but not limited to, all requirements relating to registration, inspections, concurring partner reviews and quality control standards.
       

C. The Commission will consider an application by Respondent to resume appearing or practicing before the Commission provided that his state CPA license is current and he has resolved all other disciplinary issues with the applicable state boards of accountancy. However, if state licensure is dependant on reinstatement by the Commission, the Commission will consider an application on its other merits. The Commission's review may include consideration of, in addition to the matters referenced above, any other matters relating to Respondent's character, integrity, professional conduct, or qualifications to appear or practice before the Commission.

By the Commission.

Jonathan G. Katz
Secretary


Endnotes

The Commission, with due regard to the public interest and without preliminary hearing, may, by order, . . . suspend from appearing or practicing before it any . . . accountant . . . who has been by name . . . permanently enjoined by any court of competent jurisdiction, by reason of his or her misconduct in an action brought by the Commission, from violating or aiding and abetting the violation of any provision of the federal securities laws or of the rules and regulations thereunder.


http://www.sec.gov/litigation/admin/34-50932.htm


Modified: 12/29/2004