Former Digi CFO Accused of Securities Fraud
The former Chief Financial Officer of Digi International Inc. has been hit with securities fraud charges that allege he illegally approved corporate funds for personal use for half-a decade.
According to the U.S. Securities and Exchange Commission, now-58-year-old Subramanian Krishnan secretly approved expenses from top executives at Digi by sending the requests through Digi’s Asia Pacific regional office in Hong Kong. This went against the company’s policy, which states the company CEO has to approve expenses. These unauthorized expenses continued for more than five years until Krishnan left the company in May 2010.
Among these expenses were his own hotel and personal entertainment costs, although the securities fraud lawsuit does not identify anything specific, according to the Star Tribune.
The unauthorized expenses were categorized by as securities fraud because after the expenses had been approved, Krishnan allegedly hid evidence of them with public misstatements to both the SEC and investors.
"Digi has not been affiliated with Mr. Krishnan since May 2010 when it became aware of the allegations of his behavior that led to the SEC’s recently filed complaint," read a statement from Digi regarding the lawsuit. "The company reported the allegations to the government and has not been charged with any wrong doing."
If you or a loved one has victimized in any way by securities or investor fraud, call Sokolove Law today for a free legal consultation regarding a securities fraud lawsuit.