Ex-Homestore Exec To Plead GuiltyJan 9, 2003 | AP
A former executive of the online real estate technology company Homestore Inc. agreed to plead guilty to participating in a scheme to inflate the company's earnings, authorities said Wednesday.
Jeffrey M. Kalina, 31, who was Homestore's senior manager of mergers and acquisitions, agreed to plead guilty to one count of securities fraud, the Securities and Exchange Commission and U.S Attorney's office said in a joint statement.
As part of the agreement, Kalina will cooperate with the government in an ongoing investigation of Homestore, said assistant U.S. attorney Debra Yang.
Kalina could be sentenced to as much as five years in prison and fined $25,000.
He also agreed to settle a civil complaint by the SEC that alleges he falsified Homestore's records. The SEC ordered him to return more than $74,000 in ill-gotten gains and suspended him from appearing or practicing before the SEC as an accountant.
Kalina was the latest of several former Homestore executives who agreed to plead guilty to federal charges for their role in the financial fraud scheme.
Federal prosecutors say that from March 2001 to December 2001, the company moved some of its money to co-conspirators, and then returned the money, booking it as new revenue. The company overstated revenues in the first three quarters of 2001 by as much as $95 million, prosecutors say.
The Westlake Village, Calif.-based company supplies online technology tools and Web sites for buying, selling and renting real estate. Homestore operates Web sites including REALTOR.com; HomeBuilder.com; and Homestore.com.