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URL:  http://boards.fool.com/former-enterasys-ceo-pleads-guilty-21322072.aspx

Subject:  Former Enterasys CEO Pleads Guilty Date:  9/17/2004  10:42 AM
Author:  zoningfool Number:  515 of 532

FOR IMMEDIATE RELEASE
WEDNESDAY, SEPTEMBER 15, 2004
WWW.USDOJ.GOV
CRM
(202) 514-2008
TDD (202) 514-1888


FORMER CHIEF EXECUTIVE OFFICER OF ENTERASYS
NETWORK SYSTEMS, INC. PLEADS GUILTY IN FRAUD SCHEME

WASHINGTON, D.C. - Assistant Attorney General Christopher A. Wray of the Criminal Division and Acting United States Attorney Peter E. Papps for the District of New Hampshire announced today that the former chief executive officer of Enterasys Network Systems, Inc., a computer hardware and software corporation previously headquartered in Rochester, New Hampshire, has pleaded guilty to charges arising from a revenue recognition scheme.

Enrique “Henry” P. Fiallo, 52, of Hampton Falls, New Hampshire, entered his guilty plea this afternoon before Judge Steven J. McAuliffe at U.S. District Court in Concord, New Hampshire. Fiallo, the former CEO of Enterasys, pleaded guilty to a one-count criminal information charging him with conspiracy to commit mail, wire and securities fraud for his participation in a scheme to fraudulently inflate by over $20 million the amount of revenue Enterasys reported to its shareholders and the Securities and Exchange Commission for the quarter ended Sept. 1, 2001. Fiallo also entered into a cooperation agreement with the government.

The information alleges that Fiallo and his co-conspirators caused Enterasys to