|SEC SUES FORMER OFFICERS OF MADERA INTERNATIONAL AND THE COMPANY'S FORMER AUDITORS|
The SEC today filed complaints in the United States District Court for
the District of Columbia charging three former officers of Madera
International, Inc. with falsifying Madera's financial statements and
fraudulently inflating the company's assets, sales and net income.
Madera was engaged in exporting timber from South America.
Named in the first complaint, in addition to Madera, are Ramiro
Fernandez-Moris, of Miami, Florida, and Daniel S. Lezak, of Incline
Village, Nevada, both former CEOs and Chairmen of the Company. The
complaint alleges that:
* From 1994 through early 2000, Fernandez-Moris and Lezak variously caused
the company to report as assets purported timber-producing properties in
South and Central America to which it had no apparent legal title and to
assign unrealistic values to those properties, to record revenues from phony
sales, and to furnish false sales invoices, shipping documents, cash receipts
records, and audit confirmations to Madera's auditors;
* Management issued false press releases concerning, among other things,
the Company's results of operations and business prospects; and
* Ferandez-Moris and Lezak enriched themselves by selling Madera stock
during the period of their falsification of the Company's public disclosures.
The SEC also filed settled proceedings against Regina Fernandez,
Madera's former corporate secretary. Fernandez consented to the
issuance of an order that she cease and desist from violations of the
antifraud, reporting, books and records provisions of the Exchange Act,
Sections 10(b) and 13(b)(5) of the Exchange Act Rules 10b-5, 13b2-1 and
13b2-2 and from causing any violations of Section 13(a) of the Exchange
Act and Exchange Act Rules 12b-20, 13a-1 and 13a-13 and agreed to pay a
$15,000 civil penalty.
The SEC also instituted an administrative proceeding to determine
whether the registration of Madera's common stock should be revoked
based, among other things, on Madera's failure to file required periodic
reports with the Commission.
Finally, the SEC filed settled administrative proceedings against
Madera's former auditor Harlan & Boettger, LLP, and its two audit
partners, William C. Boettger and P. Robert Wilkinson, as well as the
company's successor auditor, Ralph Sanchez, alleging improper
professional conduct with respect to their audits of Madera's financial
statements. Harlan & Boettger, Boettger and Wilkinson consented to the
entry of an order permanently denying each of them the privilege of
practicing as accountants before the Commission. Sanchez consented to
the entry of an order denying him the privilege of practicing as an
accountant before the Commission with a right to reapply after one year.
[SEC v. MADERA INTERNATIONAL, INC., RAMIRO FERNANDEZ-MORIS and DANIEL S.
LEZAK, Civ. No. 01-10985 (JR) (D.D.C.]; [SEC v. REGINA FERNANDEZ, Civ.
No. 01-10986, JR, D.D.C.] (LR-17140; AAE Rel. 1453); (IN THE MATTER OF
MADERA INTERNATIONAL, INC., Rel. 34-44814; AAE Rel. 1449; Administrative
Proceeding File No.3-10577; IN THE MATTER OF REGINA FERNANDEZ, Rel.
44815; AAE Rel. 1450; Administrative Proceeding File No.3-10578; IN THE
MATTER OF RALPH SANCHEZ, Rel. 34-44816; AAE Rel. 1451; Administrative
Proceeding File No. 3-10579; IN THE MATTER OF HARLAN & BOETTGER, LLP,
WILLIAM C. BOETTGER and P. ROBERT WILKINSON, Rel. 34-44817; AAE Rel.
1452; Administrative Proceeding File No. 3-10580)