U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19872 / October 17, 2006
Accounting and Auditing Enforcement
Release No. 2495 / October 17, 2006
Securities and Exchange Commission v. Keith G. Baxter, et al., (Civil Action No. 05-3843 RMW, N.D. Cal.)
SEC Settles with Ronald J. Goedde
The Securities and Exchange Commission today announced that on October 17, 2006, the Honorable Ronald M. Whyte entered an order of permanent injunction prohibiting Ronald J. Goedde, former Chief Financial Officer of Cornerstone Propane Partners, LLP, from future violations of the anti-fraud and reporting provisions of the federal securities laws. The order also requires Goedde to pay disgorgement of $82,717 plus prejudgment interest thereon in the amount of $20,630.00; and orders a civil money penalty of $35,000. In addition, the order prohibits Goedde from acting as an officer or director of a public company for five years. Goedde consented to the entry of the injunction and the administrative order without admitting or denying the allegations of the Commission's complaint.
The complaint alleged generally that Goedde signed Cornerstone's fiscal year 2000 Form 10-K and three fiscal year 2001 Forms 20-Q that falsely represented that Cornerstone's financial statements complied with Generally Accepted Accounting Principles; that Goedde signed false management representation letters to Cornerstone's outside auditors; that Cornerstone's financial statements did not comply with GAAP because of a breakdown in accounting at a Cornerstone subsidiary which rendered the company's financial statements materially unreliable; that Cornerstone did not disclose the possibility of a write-down, and that Cornerstone failed to disclose that the company's inter-company accounts did not balance.
The injunction prohibits future violations of Sections 10(b) and 13(b)(5) of the Securities Exchange Act of 1934 ("Exchange Act") and Rules 10b-5, 13b2-1 and 13b2-2 thereunder and aiding and abetting violations of Sections 13(a) and 13(b)(2) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder.
Goedde also consented to the entry of an Administrative Order, pursuant to Rule 102(e) of the Commission's Rules of Practice, barring him from appearing or practicing before the Commission as an accountant, with a right to reapply after five years.