Former Charter Communications Inc. chief financial officer Kent Kalkwarf pleaded guilty to one charge of conspiracy to commit wire fraud Wednesday, avoiding what could have been a lengthy federal trial that was set to begin in about two weeks.
Kalkwarf and former Charter chief operating officer David Barford were indicted in July 2003 on 14 counts of fraud and conspiracy stemming from a scheme to defraud Charter investors by artificially inflating the MSO’s subscriber numbers.
Also at that time, former Western-region senior vice president James “Trey” Smith and former Eastern-region senior VP David McCall were indicted on one count of conspiracy to commit wire fraud and eight counts of wire fraud tied to the same scheme.
McCall pled guilty to one charge of conspiracy to commit wire fraud in July 2003. Barford pled guilty to the same charge in December 2004, followed by Smith earlier this month.
As part of their deals with the government, the three former executives had all agreed to testify against Kalkwarf in his trial, which was scheduled for Feb. 7.
Kalkwarf faces up to five years in prison and/or fines of up to $250,000 when he is sentenced April 22.
“Mr. Kalkwarf's plea to this fraudulent scheme is a perfect example of how infectious and poisonous corporate fraud can be,” U.S. Attorney James Martin said in a prepared statement.
Barford is scheduled to be sentenced in March, as is McCall. Smith is scheduled to be sentenced April 1.
"Charter declines specific comment on Mr. Kalkwarf’s guilty plea since his employment was terminated in December 2002 following an internal investigation," Charter senior vice president of communications David Andersen said in a prepared statement. "As such, his plea today will have no impact on our operations."
Andersen added, "It should be noted that Charter has fully cooperated with the government in its investigation, and it was not charged. At the time of the indictments of four former employees, the government praised Charter for its extraordinary cooperation and stated that neither the company, nor any of its current officers or directors, is a target of the inquiry. Charter continues to cooperate with the investigation and remains focused on its operations."