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 user 2004-01-15 at 9:36:00 am Views: 79
  • #4675
    Indictments expand Katun case
    A federal grand jury Tuesday indicted two former executives of Katun Corp., along with the company’s co-founder who’s already in prison for tax evasion, charging the trio with being part of a long-running scheme of kickbacks and bribes at the Bloomington company.

    The indictments are the first to emerge from a far- flung, ongoing investigation of the copier parts giant by the FBI and the U.S. Postal Inspection Service – a probe that has galvanized a Who’s Who roster of more than 20 Twin Cities-area defense lawyers. A variety of settlements are in the works, say sources close to the investigation, including a possible overarching settlement by the company itself.

    The investigation widened after Katun’s former chief executive and co-founder Terence “Mike” Clarke pleaded guilty last February in the biggest individual tax-fraud case in the state’s history.

    Clarke, former Katun chief financial officer Kerry Baubie, 46, of Apple Valley, and Katun’s former senior vice president Raymond Wirtz, 53, now of Florida, all are named in five new counts: one of conspiring to commit offense against the country, two of mail fraud and two of travel act violations.

    Over a period of more than 15 years, the men allegedly paid $140,000 in kickbacks to competitor Minolta Business Systems, and allegedly bribed employees of Xerox Corp. to get pricing information, mailing secret “consulting payments” to Xerox workers. Katun later privately settled with Minolta over the alleged kickbacks for $60,000 cash and $40,000 in free products.

    Katun Corp. agrees to pay $11 million in penalties
    Katun Corp. has agreed to pay $11 million in fines and restitution for illegally obtaining pricing information from competitors’ Web sites, keeping money owed to customers and engaging in deceptive practices to secure lower airline fares.

    The Bloomington-based Katun agreed Tuesday to plead guilty in federal court to 12 counts of fraud for the illegal practices. The Penalty being imposed on the company appears to be the largest Ever assessed against a business in Minnesota, topping the $9.1 million Ashland Petroleum paid for violations in 2002.