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Fomer Applix CEO Found Not Guilty Of Accounting Fraud

The SEC had charged that Alan Goldsworthy masterminded two schemes to falsely inflate software maker Applix's revenue in 2001 and 2002.
A jury on Friday cleared former Applix CEO Alan Goldsworthy of securities fraud charges.

The jury handed down its verdict in federal court in Boston following a day of deliberations that capped a four week trial.

The U.S. Securities and Exchange Commission had charged that Goldsworthy masterminded two schemes to falsely inflate software maker Applix's revenue in 2001 and 2002.

"I'm grateful that my reputation has been finally cleared in this matter," Goldsworthy said in a statement. "I am looking forward to putting the SEC's false allegations behind me," added Goldsworthy, now CEO of golf training company ModelGolf.

The SEC settled allegations of accounting fraud with Applix in 2006, but filed separate, civil charges against three executives -- including Goldsworthy -- under a then new policy under which the Commission vowed to pursue individual executives suspected of cooking their company's books.

The SEC alleged that the three Applix execs manufactured a plan to improperly recognize $898,000 in revenues in 2001 so that the company could meet its financial targets for the year.

The Commission also charged that Goldsworthy cooked up a scheme to improperly recognize $341,000 in sales in June 2002 to inflate bonuses for himself and the other executives.

Goldsworthy resigned in the wake of the allegations.

"From the start, we were convinced these charges should never have been filed," said Deborah Thaxter, Goldsworthy's attorney, in a statement Friday.

Applix, which builds forecasting and other business applications, was acquired by business intelligence software vendor Cognos last year. Cognos in turn was acquired by IBM in January for $5 billion.

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