Correction 12/5/08: An earlier version of this article contained a misspelling of the name of Microsemi CEO James J. Peterson in two locations. This has been corrected.
According to new background checks conducted by Barry Minkow, co-founder of the Fraud Discovery Institute, two more executives misrepresented their educational credentials in regulatory filings: Broadcom Corp. (NASDAQ: BRCM) Senior Vice President Vahid Manian and Microsemi Corporation (NASDAQ: MSCC) Chief Executive Officer James J. Peterson.
Worst yet, both executives sit on the board of directors of STEC Inc. (NASDAQ: STEC). Therefore, two of six board members of STEC Inc. and two of four members of its audit committee used phony credentials in SEC filings, according to the Fraud Discovery Institute background reports.
According to the first background check, Broadcom Senior Vice President and STEC Board Member Vahid Manian did not receive a “B.S.E.E and an M.B.A from the University of California, Irvine” as claimed in a Broadcom proxy filing and an STEC proxy filing with the SEC.
A Bloomberg News article by Ian King provides additional details:
Broadcom Corp. Senior Vice President Vahid Manian didn’t earn degrees from the University of California that are listed in his company biography, according to the school’s registrar.
Manian, who oversees global manufacturing at Broadcom, attended the University of California at Irvine between September 1979 and August 1983, but wasn’t awarded any degrees, said Mark Fonseca, who is responsible for privacy issues in the school registrar’s office, in an interview. Manian’s biography on Broadcom’s Web site says he has bachelor’s and masters of business administration degrees from the school.
Fonseca said Manian attended classes for four years, but didn’t graduate. He said he isn’t allowed by law to disclose why Manian didn’t receive a degree. Fonseca said the school had no record of Manian studying for an MBA.
Manian also sits on the board of STEC Inc., a Santa Ana, California-based maker of storage drives. A regulatory filing for that company also lists undergraduate and MBA degrees from UC Irvine in Manian’s biography.
Broadcom, based in Irvine, California, makes chips for flat-panel televisions, mobile phones and computer-game consoles. Manian joined the company in 1996 as director of operations, according to Broadcom’s Web site. Before Broadcom, he worked at chipmaker Silicon Systems Inc.
Broadcom spokesman Bob Marsocci said he was looking into the matter. A message left on Manian’s assistant’s voicemail wasn’t returned.
“I am sure that Vahid went to UCI and graduated, he was there with my brother,” Manouch Moshayedi, STEC’S chief executive officer, said in a telephone interview.
James J. Peterson
According to another background check, Microsemi Chief Executive Officer and STEC Board Member James Peterson did not receive a "B.A. in business administration and an M.B.A. from Brigham Young University" as claimed in STEC's proxy filing with the SEC.
Another Bloomberg News article by Ian King reports:
Carri Jenkins, a spokeswoman for Brigham Young University in Provo, Utah, said Peterson took classes from 1978 to 1980, but didn’t receive any degrees. A regulatory filing for STEC Inc., a company where Peterson serves as a director, said he has bachelor’s and master’s degrees in business administration from Brigham Young University.
A U.S. government security clearance application form provided by Peterson lists his position at Microsemi and states that he has bachelor’s and MBA degrees from Brigham Young.
Peterson was awarded an associates degree in arts, sciences and general education from Ricks College in Rexburg, Idaho in December 1978, said Kyle Martin, registrar of Brigham Young University -- Idaho. In 2001, Ricks College became Brigham Young University Idaho, which is separate from the school in Utah, he said. As a former junior college, it couldn’t have conferred a higher degree, he said.
“That’s not correct,” Peterson said, referring to the information provided by Brigham Young. “I’ll contact them immediately.”
Peterson said in a telephone interview that he earned credits during his military service that counted toward the degree from Brigham Young. He didn’t provide a university transcript after earlier saying he would.
Cliff Silver, a spokesman for Irvine, California-based Microsemi, referred inquiries to the CEO. The company makes chips for military and aerospace customers, according to its Web site.
On November 16, 2008, my blog reported that by Barry Minkow and his private investigation firm, the Fraud Discovery Institute, found eight instances of company executives misrepresenting their academic credentials. According to Minkow, those individuals touting phony credentials are:
- MGM Mirage (NYSE: MGM): Chairman and Chief Executive Officer Terry Lanni:
- Trimble Navigation Limited (NASDAQ: TRMB): Executive Vice President and Executive Committee member Dennis Workman
- Cabot Microelectronics Corp (NASDAQ: CCMP): Chief Information Officer James DeHoniesto
- Tetra Tech Inc. (NYSE: TTEK): President Sam Wesley Box
- Knight Capital Group Inc. (NASDAQ: NITE): Director and former Executive Vice President Robert M. Lazarowitz
- Helix Energy Solutions (NYSE: HLX): President and Chief Executive Officer Owen Eugene Kratz
- Life Partners Holdings (NASDAQ: LPHI): Director Harold E. Rafuse
- PepsiAmericas (NYSE: PAS): President and Chief Executive Officer Kenneth E. Keiser
The Fraud Discovery Institute's background checks on the above executives can be accessed here.
Deceitful directors and officers of public companies have been forewarned by Barry Minkow:
If you lie about your resume, past experience, and qualifications for your present job and such lies show up in SEC filings, he will find out about it and expose you to investors and regulators.
Minkow and I believe that if you lie about your educational background, you are capable of lying about anything else, too. Investors require honesty from the fiduciaries running their companies. If Barry Minkow can find false credentials in corporate America where company gatekeepers have failed, what other more devastating internal control failures exist that we do not know of?
To be continued....
Disclosure: I am not short or long any of the companies named in this blog post. However, the Fraud Discovery Institute and/or Barry Minkow may have a short position in the companies mentioned in this blog post. Please read the Full Disclaimer on FDI for Profit Status.
Over a year ago, I provided funds to Fraud Discovery Institute (FDI) to help pay costs of its investigations, though I had no control over any monies spent. I am not an owner, manager, employee, or consultant of Minkow or FDI and I have not received any compensation from them.