Cisco executive in court for $5m fraud

NEWS Appearing in San Jose federal court, Robert Gordon admitted breaking company rules but denied criminal activity, according to papers filed by the federal attorney. He was freed after posting a $5m cash bond and putting up his $1.6m house as surety. Gordon had only recently been promoted to vice president after five years with the company. It is alleged he transferred more than 30,000 shares of Internet Security Services Group, a company bought by Cisco, into a Bahamas-based shell company called Cisco Systems. He then allegedly used the $5m proceeds to set up a phoney venture capital firm and induced a Cisco start-up business partner to invest a further $10m. Cisco discovered that the original 30,000 shares were missing on 4 April and told Gordon to clear his desk. According to court papers, Gordon said he was trying to get cash quickly to Cisco-affiliated start-ups. These are tumultuous times for the company, as two Cisco accountants were recently charged in federal court with breaking into the company network and transferring millions of dollars worth of Cisco stock to their own brokering accounts. silicon.com also reported yesterday that a class action has been filed against the company by a group alleging it has been selling faulty goods and agreeing to unacceptable finance deals in a bid to boost earnings. silicon.com is currently conducting a campaign to fight fraud on the net by calling for the creation of an independent body that cybercrime victims can report to in confidence. If you want to support this campaign, send a mail to editorial@silicon.com