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Former Ferro Executive Indicted

Government charges former controller with securities fraud

by William J. Storck
September 1, 2005

Brian Haylor, formerly controller of the chemical group/polymer additives division of Ferro Corp., has been charged with securities fraud, according to Gregory A. White, U.S. attorney for the Northern District of Ohio.

The charge alleges that from March 6, 2003, through June 4, 2004, Haylor, 37, committed securities fraud by causing Ferro to prepare and file false quarterly and annual reports with the Securities & Exchange Commission.

Specifically, Haylor is alleged to have made false entries to make Ferros earnings appear higher and its debts to appear lower so that the companys actual results would appear to come close to its previously forecasted results.

The charge further alleges that Haylor sought to conceal his conduct by providing false and misleading information to Ferros outside auditors, including false spreadsheets purporting to be a calculation of temporary accounts receivable. Hes also charged with falsely stating to the auditors that the unrecorded liabilities account had a debit balance because of a miscoding error when, in reality, it was due to fraudulent entries he had made.

Ferro has been working since July 2004 to clean up the accounting mess, including a restatement in January 2005 of almost two years of earnings. The company says the process may be completed soon.


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