Magazine

Table: Over the Line?


Apart from legal problems, Avant! Chairman Gerry Hsu has drawn criticism for a variety of business practices

BOARD OF DIRECTORS

Most board members have close ties to Avant! and Hsu. Some have suspect qualifications, including a former park ranger who is friendly with Hsu's sister.

ACCOUNTING

In a letter to the SEC, former auditor listed such concerns as "incomplete and missing contract documentation" and "inadequate internal communications in connection with recording revenue."

COMPENSATION

Hsu pays an enormous salary to 27-year-old son John, who earned nearly $1 million despite his lack of experience. The company's second-highest-paid employee is a former stewardess Hsu met years ago, who took home nearly $1.5 million last year.

PUBLIC RELATIONS

After being hit with criminal charges, Avant! set up a foundation that offers grants to Silicon Valley residents. Trouble is, it has spent nearly twice as much on promoting itself via radio ads as it has on good works.


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