NEW YORK (Reuters) – A former chief executive of the Duane Reade Holdings Inc drugstore chain pleaded not guilty on Friday to securities fraud, conspiracy and charges of making false statements to securities regulators.
Former CEO Anthony Cuti, 63, is accused of providing false information during negotiations over the purchase of Duane Reade, previously a publicly held company, by private equity firm Oak Hill Capital Partners in 2004.
U.S. Magistrate Judge Frank Maas in Manhattan federal court released Cuti, who surrendered to authorities on Friday morning, on a $3 million personal recognizance bond.
According to the U.S. Attorney’s Office in Manhattan, from December 2000 through June 2005, Cuti and former Chief Financial Officer William Tennant “engaged in a scheme to misrepresent Duane Reade’s financial performance” to investors and fraudulently made millions of dollars.
The SEC filed separate civil charges accusing the pair of multimillion-dollar accounting schemes when they were in charge of Duane Reade, the biggest chain of drug stores in the New York City area.
Cuti’s attorney in the civil case, Jeffrey Sklaroff, said in a statement that the transactions were disputed and had no effect on stockholders, bondholders, the company or Oak Hill.
Tennant will be arraigned at a later date, prosecutors said. His attorney was not immediately available for comment. (Reporting by Edith Honan; Editing by Brian Moss) (nyc.buro@reuters.com; +1 646 223 6280))
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