August 25, 2014 by Arezu Sarvestani
Federal prosecutors want a 30-year sentence for former ArthroCare CEO Michael Baker and 20 years for former CFO Michael Gluk in a securities fraud lawsuit estimated at as much as $960 million.
Prosecutors for the federal government are seeking hefty sentences for a pair of former ArthroCare (NSDQ:ARTC) executives found guilty of defrauding investors.
The feds asked for a 30-year sentence for former CEO Michael Baker and a 20-year sentence for former CFO Michael Gluk, saying that the pair showed no remorse for running a scheme that cost investors up to $960 million. Prosecutors further asked for $25 million total in restitution from both men as well as a 5-year term of supervised release following their prison terms.
“Michael Baker, President and Chief Executive Officer of ArthroCare Corporation and Michael Gluk, ArthroCare’s Chief Financial Officer, perpetrated a multi-year fraud scheme that caused hundreds of millions of dollars in losses and nearly took down an Austin-based publicly-traded company with more than 1000 employees,” lawyers for the U.S. government said a sentencing memorandum. “Perhaps most tellingly, at the time of the filing of this memorandum, neither Baker nor Gluk have shown the slightest bit of remorse for the terrible harm their actions caused to ArthroCare’s investors and employees. Instead, they continue to focus entirely on minimization, obfuscation, and finger-pointing.”
Prosecutors added that Baker and Gluk had lied under oath and attempted to thwart the SEC’s investigation.
