|NTG's former finance chief pleads guilty||
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NTG Press Coverage Summary
Thomas Bray, the man who was chief financial officer at Network Technologies Group Inc. when the company collapsed last year, pleaded guilty Thursday morning to one count of wire fraud for his role in the company's alleged scheme to defraud investors and its bank, Mercantile-Safe Deposit & Trust Co. out of millions of dollars.
Bray was the second former NTG officer to plead guilty to wire fraud in federal court this month after the U.S. Attorney's Office charged four NTG executives with 10 counts of wire, bank and mail fraud. Michele Tobin, NTG's former CEO, pleaded guilty to the same charge on Feb. 20.
Two other former NTG officers, Victor Giordani Jr., the bank's former chief operating officer, and Beverly Baker, the former controller, pleaded not guilty earlier this month.
Bray declined to comment after a hearing before U.S. District Judge J. Frederick Motz. His attorney, Gerald C. Ruter of Baltimore, said that Bray was accepting responsibility for his part in the alleged crime, but said he wasn't as culpable as other NTG officers.
"Mr. Bray's sin is one of omission, not commission," Ruter said. "The main actors were Michele Tobin and Beverly Baker."
Federal prosecutors allege that NTG's officers doctored the company's financial records to make it appear that the struggling telecommunications construction company was doing better than it actually was so that it could attract investors and a $3.5 million line of credit from Mercantile. In the spring of 2002, NTG secured $1.75 million in financing from two investors, including the Abell Foundation of Baltimore, using the doctored records, prosecutors allege.
Ruter says that while Bray signed off on the company's financial documents, he did not routinely prepare them himself.
"He shouldn't have signed them," Ruter said. "He chose to sign his name, and they were used to assist the company in attempting to get some loans. It was a mistake."
Ruter called Bray "remorseful."
Prosecutors say that Bray joined NTG in the fall of 2000 and earned $150,000. By the time NTG collapsed in July of 2002, he earned $175,000.
NTG laid off all 125 employees just a few weeks after Tobin resigned from the firm June 28 after telling employees she had cancer. John Collard, an Annapolis consultant brought in by the NTG board to turn the company around and hire a new CEO found the alleged accounting fraud within days of his arrival on July 1. Collard shut the company down July 12. Prosecutors began investigating the company the next day and seized computer and financial records. Tobin left town for the Colorado resort town of Vail where she has a home.
A trial for Baker and Giordani is scheduled to take place April 7. Each count of fraud in the indictment carries of maximum sentence of 30 years in federal prison and a $1 million fine.
Tobin and Bray will be sentenced after any trial. The severity of their sentences will depend largely upon how much they cooperate with the government in prosecuting Baker and Giordani.
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