The Department of Justice is investigating allegations of accounting
irregularities at AOL Time Warner Inc., company officials confirmed
'In the current environment, when anyone raises a question about accounting,
it's not surprising that the relevant government agencies will want to look into
the facts,' the company said in a prepared statement.
The DOJ probe comes on the heels of a previously announced Securities and
Exchange Commission investigation of the allegation. Unlike the SEC, which can
only levy civil fines and sanctions, the DOJ can bring criminal charges against
a company and its officers.
The investigations follows reports two weeks ago by TheWashington
Post detailing the company's efforts to boost bottom-line numbers with
aggressive accounting maneuvers. The practices included selling ads to a British
entertainment company in lieu of taking a cash settlement in a legal dispute and
booking sales from ads that were sold on behalf of eBay Inc.
The company insisted that it has done nothing wrong.
The DOJ review is the latest in a string of setbacks for the world's largest
media company. Earlier this month, it replaced its second-in-command, Robert