SAN JOSE — Federal regulators have charged Andrew Miller, former CEO of videoconferencing firm Polycom, with using nearly $200,000 in corporate funds for personal perks that were not disclosed to investors, including travel to luxury resorts with his girlfriend.
The Security and Exchange Commission levied seven charges against Miller, alleging fraud in creating “hundreds of false expense reports with bogus business descriptions for his personal use of company dollars to pay for meals, entertainment, and gifts.”
In 2012 alone, Miller charged Polycom for more than $115,000 in personal expenses despite publicly reporting that he received less than $35,000 in perks that year, the SEC alleges.
Miller resigned in July 2013 as CEO and a board member of Polycom after the audit committee of the San Jose-based company’s board discovered irregularities in his expense reports.
The SEC stated that Miller hid the costs by directing a travel agent to bury them in fake budget line items.
“Miller used Polycom funds to travel with his friends and girlfriend to luxurious international resorts while falsely claiming the trips were business-related site inspections in advance of company sales retreats,” the SEC said.
Polycom reached a settlement with the SEC and will pay a $750,000 civil penalty while neither admitting nor denying the SEC’s findings.
“As previously disclosed in Polycom filings, the company has been cooperating with the enforcement staff of the SEC in connection with its investigation focused on the expenses of Andrew Miller,” the company stated.
Polycom declined to discuss the matter further when reached for comment.
“You knew when the company said back in July 2013 that Miller’s departure had to do with expense irregularities, that there had to be something pretty significant here,” said Michelle Leder, founder and editor of Footnoted, an online site that tracks executive compensation issues. “That’s because most of the time, companies tend to use ‘leaving for personal reasons’ or ‘more time with the family.’ “
Miller engaged in a wide-ranging array of activities in connection with the perks reporting, according to the SEC.
Among the improper expenditures by Miller, according to the SEC complaint: more than $80,000 for personal travel and entertainment that Miller hid in falsified invoices or passed off as legitimate business expenses, more than $10,000 for clothing and accessories, more than $10,000 for tickets to professional baseball and football games that Miller falsely claimed to have attended with clients, more than $5,000 worth of spa gift cards that Miller falsely claimed to have given as gifts to customers and employees, and more than $5,000 for plants and a plant-watering service at Miller’s apartment that he falsely claimed were for the company’s San Francisco office.
“You do see scandals like this from time to time,” said Mae Lon Ding, president of Personnel Systems Associates, an Anaheim Hills-based firm that tracks executive compensation issues.
Staff writer Jeremy C. Owens contributed to this report. Contact George Avalos at 408-859-5167. Follow him at Twitter.com/georgeavalos.
