Ex-Homestore CEO Pleads Guilty to Fraud
Former Homestore CEO Stuart Wolff is facing three to five years in prison for conspiracy to commit securities fraud.
Wolff was convicted in 2006 of 12 charges stemming from a scheme in which the online property listings company would pay vendors extra for their products or services. The vendors would use the money to buy advertising from select media companies. These media companies would buy advertising from Homestore, providing Homestore with revenue that make it appear that it had exceeded Wall Street analysts’ expectations.
The 9th Circuit Court of Appeals overturned the conviction because it said the trial judge should have recused himself. Wolff agreed Tuesday to a plea agreement to avoid another trial. The case also led to the conviction of 11 other defendants.
Wolff’s lawyers blamed other employees, saying their client didn’t know about the dealings. Prosecutors argued that it would be difficult for Wolff to not to have known about $86 million in dealings.
Wolff headed Homestore, from 1997 until he resigned in January 2002. The Westlake Village, Calif., company has since changed its name to Move Inc.
The NATIONAL ASSOCIATION of REALTORS® has a minority stake in Move. Inc.
Move Inc. operates NAR’s official Web site www.Realtor.com.
Source: The Associated Press (01/12/2010)
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