Infogroup Founder to Pay Back $7.3m

Vin Gupta, the founder of database giant Infogroup, has agreed to pay $7.3m to settle federal regulators' charges that he improperly used nearly $9.5m of company money. In doing so, he has neither admitted nor denied the allegations.

Gupta was sacked as Infogroup Chairman in 2008, following an investigation which found he had misspent millions of dollars for use of a jet plane, an 80-foot yacht, apartments in Hawaii and California, a University of Nebraska stadium box and personal flights for Bill and Hillary Clinton.

At the time, Gupta agreed to repay a $9m litigation settlement fee, while receiving $10m in severance pay. He was replaced as Chairman by Bill Fairfield, who assumed the position after the Board's Special Litigation Committee separated the role from that of CEO.

In a separate settlement announced yesterday, Vasant Raval - former Director and Audit Committee Chairman of Infogroup - has agreed to pay a $50k penalty, without admitting any wrongdoing.

Additionally, the SEC has filed civil lawsuits against the firm's former Chief Financial Officers Rajnish Das and Stormy Dean, who are accused of approving Gupta's illegal spending sprees.

Last week, Infogroup - which owns research firm ORC (Opinion Research Corporation) - agreed to be acquired by affiliates of CCMP Capital Advisors, LLC for a total of around $635m.

Gupta, who owns about 35% of Infogroup's stock, stands to make more than $118m from the company's sale. He has now resigned his seat on the Board, after voting with the rest of the Directors to recommend selling the company.

On Friday, an Infogroup investor filed a lawsuit against the company alleging that CCMP's offer price of $8.00 per share 'is unfair to shareholders because it represents no premium'.

The suit, which refers to the 'destruction' of company value following the firing of founder Gupta, claims that shares in the group have more than doubled in value over the past year; and that the CCMP deal is 'designed not to maximize value for the company's shareholder, but to benefit company insiders such as Gupta'.

Web site: www.infogroup.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

• Infogroup | ORC
• All news