US fraud trial of Corkman delayed

THE retrial of a Corkman on fraud charges in the US has been postponed again.

Jerry Shanahan, from Carrigaline, had been due to go on trial yesterday, but a federal judge in Concord, New Hampshire, postponed the trial until June 3.

He has been accused of fraud relating to his time as chief operating officer at the US-listed tech firm Enterasys. He and four other Enterasys executives were accused of fraudulently inflating the company’s accounts in 2001.

US prosecutors claim Mr Shanahan and others set up deals with Enterasys customers to route money to them to buy Enterasys products, thereby inflating his firm’s revenue and profits. Prosecutors claimed the executives tried to keep the revenue figure high to satisfy the publicly-reported expectations of Wall Street analysts and to increase or maintain the price of Enterasys stock.

When Enterasys confirmed US financial watchdog, the Securities & Exchange Commission, was investigating its activities in 2002, its share price collapsed and eventually $1bn was wiped off its value.

Mr Shanahan, a UCC engineering graduate, and four other Enterasys employees went on trial in December 2006. The four executives were found guilty but Mr Shanahan was acquitted on one count and a mistrial declared after a hung jury on the five remaining counts.

The delay in the retrial followed attempts by Mr Shanahan’s legal team to have the case thrown out. They claim the retrial breaches double jeopardy — a person acquitted cannot be tried for the charge twice. If found guilty, Mr Shanahan could face several years in a US prison. Civil proceedings are outstanding against him and other former Enterasys executives.