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Battenberg Hit With Hefty Fine for Delphi Scam

Misrepresented finances of failing auto supplier.

by on Nov.01, 2011

Former Delphi CEO J.T. Battenberg III has been hit with a hefty, $215,000 fine.

Former Delphi Corp. Chief Executive Officer J. T. Battenberg III must pay a $215,000 for violating U.S. securities laws by misrepresenting a $237 million payment to General Motors Corp.

U.S. District Judge Avern Cohn entered judgment against Battenberg and a $118,500 sanction against former top Delphi accountant Paul Free. A Detroit jury in January found the men misrepresented the GM payment and found Free committed wrong-doing in three other transactions in 2000 and 2001.

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The executives had been accused of trying to prop up the giant auto supplier’s stock even as Delphi slid steadily towards what would become the longest corporate bankruptcy reorganization in U.S. history.

“The remedies are for the court to decide,” Cohn said in separate memoranda explaining his rationale for each assessment.


Former Delphi CEO Battenberg’s Trial Wrapping Up

Prosecutors claim exec misled investors before Delphi bankruptcy.

by on Jan.06, 2011

Did former Delphi Chief J.T. Battenberg - shown here at a 2003 conference - mislead investors?

Did the former chief executive of mega-supplier Delphi intentionally mislead investors even as the company was spiraling down towards bankruptcy? That’s the key question as the long federal trial of J.T.Battenberg former Delphi chairman and CEO wraps up, with both defense attorneys and prosecutors laying out their final arguments.

The Securities and Exchange Commission’s civil complaint against Battenberg charges that the former Delphi executive – who retired as the company collapsed — set out to hide Delphi’s financial woes.

Battenberg faces no jail time but could be barred from serving on the board of any publicly traded company — and be forced to pay substantial fines.  It also would serve as a severe rebuke to an executive who was considered one of Detroit’s major corporate stars during the 1980s and 1990s.

The SEC’s prosecutors have hammered on the idea that Battenberg deliberately deceived outside investors about the handling of an item in the company financial filings in the years before Delphi filed for bankruptcy in 2005. (The company only emerged from Chapter 11 protection last year, marking the longest corporate bankruptcy in U.S. history.)