Four years ago today, Nortel Networks declared bankruptcy. Nortel’s bankruptcy was a stunning reversal of fortune for the once high-flying telecom vendor.
Among the various steps and missteps that may have led to Nortel’s downfall were a series of financial and accounting errors that the company started facing as far back as 2000. The accounting errors had caused Nortel to restate financial statements for 2000, 2001, 2002 and the first and second quarters of 2003.
As a result of the accounting errors, then Nortel CEO Frank Dunn, CFO Douglas Beatty and controller Michael Gollogly were all fired in April of 2004.
In a court decision, Justice Frank Marrocco of the Ontario Superior Court of Justice acquitted Dunn, Beatty and Gollogly of the charges against them. The three former Nortel executives had been accused of multiple charges over the handling of Nortel’s accounting practices.
“For a very long time, integrity has been the foundation of Nortel Networks’ corporate governance and business practices, ” Dunn said in a statement. “The documentary evidence and testimony re-affirmed this core value that I witnessed over my 28 years with the company.”