Industry News

Former Cendant Chairman Forbes sentenced to 12 years

Walter A. Forbes ordered to pay $3.3 billion in restitution

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Walter A. Forbes was sentenced to serve 12 years and seven months in federal prison for his role in a multimillion-dollar accounting fraud originating at a company that helped to form real estate and travel services giant Cendant Corp, U.S. Attorney Christopher J. Christie announced Wednesday. Forbes has also been ordered to pay $3.28 billion in restitution. Forbes, who had served as chairman, CEO and president at CUC, a consumer-services company that joined with Henry Silverman's HFS Inc. in launching Cendant, was convicted in October of conspiracy to commit securities fraud and making false statements. Cendant launched in December 1997, and the following year Cendant officials announced that "a 'widespread and systemic' fraud had occurred at the merged company that included improperly recognizing fictitious revenues, falsely coding services sold to consumers, and fraudulently manipulating merger reserves," according to court documents. A report adopted by Cendant's board of...