Defrauded Gemstar Investors to be Repaid

By Katie Hauser

Published on December 27, 2006

Former Gemstar CEO Henry Yuen was found guilty earlier this year of securities fraud. The SEC alleges that Yuen and others at Gemstar inflated reported revenue numbers by $248 million and that they also falsified the company’s books and misreported facts when the company was audited. Yuen, as well as four other officers of Gemstar and four members of an audit team from the firm KPMG, are believed to have committed fraudulent acts in an effort to boost the company’s stock. Yuen was ordered to pay $22.3 million in fines and penalties, but no payments have been remitted as of this date.
The money that is to be returned to investors includes the proceeds from civil penalties won by the SEC as well as disgorgement of bonuses and salary and stock options exercised by the fraudulent executives.

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