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Former United Rentals CFO Nolan Pleads Guilty to False Filings

Bridgeport, Conn. — Michael Nolan, former chief financial officer of United Rentals last month pleaded guilty to making false filings with regulators that enabled him to make a profit of $11 million, according to federal prosecutors.

Nolan pleaded guilty in federal court in Bridgeport, Conn., of making false filings with the U.S. Securities and Exchange Commission in violation of federal security laws. Nolan faces a maximum sentence of 10 years in prison and a fine of $22 million, in addition to being required to pay restitution of $11.1 million.

Authorities said Nolan and others engaged in transactions designed to falsely inflate the United Rentals' earnings per share by improperly recognizing millions of dollars in additional profit for the fourth quarter of 2000 and the full year of 2000. Between March 2001 and March 2002, Nolan and others benefited personally from the company's falsely inflated earnings per share by selling a substantial amount of the company's stock at a fraudulently inflated price, authorities said. According to prosecutors, Nolan profited $11.1 million through these stock sales.

In an effort to meet a revised earnings-per-share forecast, Nolan and others fraudulently inflated the company's earnings by engaging in a transaction the company improperly accounted for as a minor sale leaseback, according to federal authorities. Nolan and others used the transaction to fraudulently recognize about $25.3 million in revenue and $12.2 million in profit for the company in the fourth quarter 2000, prosecutors said, enabling United Rentals to meet revised earnings-per-share numbers that had been announced in a Dec. 18, 2000, press release.

TAGS: Ar Rental News
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