U.S. Drops Fraud Charges Against David Stockman

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Right before Bush leaves office...


http://www.nytimes.com/2009/01/10/business/10stockman.html?ref=business

U.S. Drops Fraud Charges Against David Stockman


Federal prosecutors said Friday that they had dropped charges against David A. Stockman, the former budget director in the Reagan administration, in connection with his role in the bankrupt auto parts maker Collins & Aikman.

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Mr. Stockman, 62, the company’s former chief executive, and three other executives — J. Michael Stepp, David R. Cosgrove and Paul C. Barnaba — were indicted in March 2007 and charged with bank fraud, conspiracy and obstruction of justice.

At issue was whether the four hid the failing financial health of the auto parts maker from investors. The indictment accused Mr. Stockman of orchestrating an effort to dupe lenders, exaggerating how much money the company was due in its accounts receivable so it could obtain more credit.

At the time, Michael J. Garcia, the United States attorney for the Southern District of New York, said: “They resorted to lies, tricks and fraud.”

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