Ex-CFO spared jail time in Cendant case

Ex-CFO spared jail time in Cendant case

	Published : Tue, 30 Jan 2007 18:13 By : Agencies Print this Story

BRIDGEPORT, Conn. (AFX) - A former chief financial officer at Cendant Corp. was spared jail time Tuesday for his role in an accounting scandal that cost investors and the travel and real estate company more than $3 billion.

Cosmo Corigliano, who pleaded guilty to fraud, was sentenced to three years of probation, including six months of home confinement with electronic monitoring, and 300 hours of community service.

Corigliano apologized in U.S. District Court in Bridgeport and said he took full responsibility for his actions.

'I realize it was very wrong,' Corigliano said. 'My one wish is I had clarity of mind.'

He faced between 6 1/2 to just over eight years in prison under sentencing guidelines.

Prosecutor Michael Martinez and Senior U.S. District Judge Alan H. Nevas said Corigliano played an indispensable role in the case and was the only cooperating witness who was able to implicate former Cendant Corp. Chairman Walter Forbes.

'Without your testimony, I don't think Walter Forbes could have been convicted,' Nevas said. 'You were the only witness that was kind of inside the corporate hierarchy.'

Corigliano had asked to be spared prison time, citing his extraordinary cooperation with authorities.

Corigliano says he gave authorities an inside account of how the multibillion-dollar accounting fraud was conceived, directed and discussed among executives. His testimony over three trials led to the conviction of Forbes and earlier of Vice Chairman E. Kirk Shelton.

Forbes was sentenced to 12 years and seven months in prison, while Shelton received a 10-year sentence. Both were ordered to pay $3.275 billion in restitution.

Two other executives, Anne Pember and Casper Sabatino, were spared prison terms Monday for their roles in the fraud. They also cited their cooperation with authorities.

Prosecutors say the scheme inflated the stock of Cendant's predecessor, CUC International, by $500 million.

The fraud cost the travel and real estate company and its investors more than $3 billion. The fraud was reported in 1998, causing Cendant's market value to drop by $14 billion in one day and leaving a trail of 119,000 victims.

The Cendant case was among the first in a series of corporate accounting scandals that sparked outrage from investors in recent years.

Corigliano, former chief financial officer at CUC, testified that for years he drew up what he called 'cheat sheets' to falsify profit.

Forbes was chief executive officer of CUC and Shelton was president before the membership marketing operation merged with travel and real-estate services company HFS Inc. to form New York-based Cendant in December 1997. Cendant's brands included Ramada, Howard Johnson, Avis, Coldwell Banker and Century 21.

In September, Cendant stockholders changed the company's name to Avis Budget Group to reflect its Avis and Budget vehicle rental brands. Its real estate and hotel businesses were spun off as stand-alone companies and the company sold its travel distribution operations.