NORTEL TRIAL

An Ontario Superior Court judge will hand down a verdict Jan. 14 in the fraud trial of three former Nortel executives,

The case of three former high-ranking Nortel executives accused of fraud is now in the hands of an Ontario judge. Ontario Superior Justice Frank Marrocco reserved his decision Wednesday after hearing four days of closing arguments and months of testimony in the long-running trial. Marrocco is scheduled to deliver his decision January 14. Former CEO Frank Dunn, exCFO Douglas Beatty and ex-controller Michael Gollogly are each charged with two counts of fraud. The Crown alleges the men falsified the Ottawa-based company’s financial statements in 2002 and 2003 to trigger millions in bonus payments. All three have pleaded not guilty. Earlier Wednesday, court heard that during his time as CEO, Dunn approved all the accounting at the beleaguered technology firm but it would have been “impossible” for him to know whether the balance sheets were accurate. Dunn’s defence lawyer, David Porter, told the court that his client trusted his company’s accountants and auditors when they gave him financial statements to rubberstamp.

His approval was symbolic because no one in the company expected him to personally verify each line in the balance sheet and he should not be held responsible for any figures that were incorrect, Porter argued.

The Crown alleges that accruals money was being moved around by the accused to show a return to profitability — when in fact, the company was struggling financially — so they could be paid $12.8 million in cash and stock bonus payments.

Those bonuses were triggered once internal financial targets were seemingly met.

In wrapping up his closing submissions, Porter told the court that the Crown has failed to show evidence that his client made “any attempt to re-jig the (financial) targets” or instructed any of his employees to do so.

“He had no reason to doubt Nortel’s accounting,” he said.

The accused were fired from Nortel in 2004.

If convicted, each could face up to 10 years imprisonment.