helped arrange the round-trip transactions with McCallum, knew about the rebate scheme, and directed at least one of the improper rebate transactions; Gerald Jones, who helped arrange the round-trip transactions with McCallum and participated in the improper recognition of rebates in the second quarter of 2004; David R. Cosgrove, who advised C&A purchasing employees on the language to be used in false documentation regarding the rebates, knowing the documentation was being used to recognize the rebates improperly; Paul C. Barnaba, who directed Purchasing Department personnel to solicit side letters falsely describing the rebate terms, knowing the letters were being used to recognize the rebates improperly; and Thomas V. Gougherty, who solicited false documents and directed accounting personnel to recognize rebates, despite knowing that key documents were falsified and that such recognition was not in conformance with GAAP.
3.C&A improperly accounted for at least 132 supplier payment transactions.
4.When C&A's accounting manipulations came under scrutiny in early 2005, C&A attempted to minimize the fraud and conceal the company's perilous financial condition. During March and April, in two press releases, a conference call with analysts, and a presentation to potential investors, C&A made materially false or misleading representations regarding its liquidity situation, its financial outlook, and the scope and impact of the rebate fraud. These materially false or misleading statements were designed in part to enable C&A to obtain additional financing.
5. Stockman directed C&A's effort in March and April 2005 to minimize the rebate fraud and hide C&A's financial condition. Other C&A executives knowingly or recklessly contributed to this concealment, including David R. Cosgrove, who