Xerox accounting methods under investigation

Xerox Corp. is the target of an investigation by the U.S. attorney's office in Connecticut into its past accounting practices.

The Stamford, Conn.-based copier and services company said in a statement today that the probe follows an earlier SEC review into the company's financial reporting that led to a settlement with the agency in April.

The investigation is being conducted by the U.S. attorney's office in Bridgeport, Conn. A spokesman today refused to comment, saying she couldn't confirm or deny that an investigation has been launched.

A Xerox spokesman, Christa Carone, said that Xerox has not yet heard directly from the U.S. attorney's office, but expects any investigation to focus on possible criminal allegations related to past accounting practices.

The initial SEC probe into Xerox's accounting practices began in June 2000. This past April, Xerox paid a civil penalty of $10 million and restated some of its financial results dating back to 1997 as part of the settlement with the SEC's Division of Enforcement (see story).

In June, Xerox restated its income, reducing it by $1.4 billion for 1997 through 2001 due to accounting irregularities (see story).

Xerox is one of a growing list of companies in recent months to restate its financial results as a result of irregularities.

Copyright © 2002 IDG Communications, Inc.

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