Edited by Douglas Harbrecht

Lars Bildman, former chief executive of Astra USA Inc., was arrested on Mar. 12 by federal authorities at his vacation home in Killington, Vt., and charged with 35 counts including fraud and tax evasion.

The indictment also charges Bildman with crossing state lines for the purpose of hiring prostitutes, which is a violation of the Travel Act, and with state tax violations in Massachusetts. A former Astra chief financial officer, Stefan Solvell, is listed as an unindicted co-conspirator.

Bildman's arrest is just the latest chapter in the long-running Astra scandal, which began last May with a Business Week cover story exposing numerous allegations of sexual harassment and other bizarre behavior at Astra USA, a subsidiary of Swedish pharmaceutical giant Astra AB. Bildman was fired by Astra in June after an internal investigation sparked by the Business Week probe (see BW, 5/13/96, "Abuse of Power").

According to the indictment, Bildman stole more than $1 million from Astra in the form of free renovations on three of his houses, free vacations, and company-paid prostitutes. The indictment says Bildman employed the same construction contractors to renovate his houses who were working on expansion projects at Astra's Westborough (Mass.) U.S. headquarters. According to the indictment, he had the contractors bill Astra for the renovations on his house, while concealing that fact from the company. At one point, the indictment charges, Bildman had an entire crate of furniture shipped from Germany and delivered to his house, all charged to Astra.

Bildman later attempted to cover up his actions by destroying documents relating to the work on his residences and by requesting third parties to destroy records for him, the indictment adds.

The most lurid accusations involve sales meetings in Florida where, the indictment charges, Bildman used Astra funds to charter boats where he and others "consorted with prostitutes paid for by Astra." The tab for the prostitutes, the indictment alleges, ran as high as $1,500 per day.

Bildman's attorney couldn't be reached for comment.

By Mark Maremont and Geoffrey Smith in Boston