Ex-Systemax executive barred as officer in deal
WASHINGTON (AP) — A former executive of the retailer that owns the CompUSA and Circuit City brands will be barred from serving as an officer or director of any public company to settle civil charges of improperly receiving payments from vendors that he failed to disclose.
Gilbert Fiorentino, formerly chief executive of Systemax Inc.'s technology products group, also is paying a $65,000 fine. That's in addition to about $9.6 million in company stock options and bonus that he agreed to surrender last year.
The Securities and Exchange Commission announced the settlement Monday with Fiorentino, who also was a director of Systemax, headquartered in Port Washington, N.Y. The SEC says he failed to disclose to Systemax or its auditors the payments he received on the side from January 2006 through December 2010.
The SEC says he received about $400,000 from companies that did business with Systemax in addition to his regular compensation, and that he stole several hundred thousand dollars' worth of company merchandise used to market Systemax products.
Fiorentino neither admitted nor denied the SEC's allegations in the settlement, but did agree to refrain from future violations of the securities laws. The deal is subject to court approval.
"Fiorentino brazenly stole from Systemax and betrayed the trust of its shareholders," Eric Bustillo, director of the SEC's Miami office, said in a statement. "His actions demonstrate that he is unfit to serve as an officer or director of a public company."
The technology products group sells computers and other consumer electronics in North America and Europe, and accounted for more than 90 percent of Systemax's $3.59 billion in revenue in 2010.
After allegations against Fiorentino emerged from a whistleblower's complaint, Systemax put him on administrative leave in April 2011. After the SEC began investigating, Fiorentino agreed to resign, and to give back about $9.1 million in Systemax shares and stock options as well as his 2010 bonus of $480,000.
The SEC filed a lawsuit against Fiorentino in federal court in Miami, where the technology products group is based. The agency alleged that Fiorentino arranged payments on the side directly from service providers, salespeople and others that did business with Systemax. For example, the SEC said, he demanded and received between $5,000 and $10,000 a month from a supplier of materials used in Systemax's retail and mail order operations.
As a result of Fiorentino's failure to fully disclose compensation, some financial reports that Systemax filed were incomplete, the SEC said.
In a statement, Fiorentino said "I am pleased to get this behind me and move on to the next chapter in my life."