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AMS Exec Settles With Federal Agency

Marcy Wilson Roke, one of three former employees of Advanced Marketing Services Inc. charged with felonies in connection with a revenue enhancement fraud at the firm, agreed to a settlement with the Securities and Exchange Commission on civil charges.

In the settlement announced Sept. 14, the SEC said Roke, AMS’ former director of advertising, agreed to pay $25,000 in a civil penalty, and $56,458 in disgorgement stemming from her role in a fraud that involved fraudulent reporting of revenues by the San Diego-based distributor of books.

Roke, who agreed to the settlement with the SEC without admitting or denying the allegations contained in the complaint, still faces criminal penalties involving the pleading.

According to the SEC complaint, fraudulent schemes that Roke participated in caused the company to overstate its pretax earnings by about 9 percent in fiscal 2001, 10 percent in fiscal 2002, and 19 percent in fiscal 2003.

Prosecutors said AMS executives concocted elaborate schemes to retain funds paid by book publishers for direct mail advertising that never occurred.

AMS, which was delisted from the New York Stock Exchange earlier this year, has not filed quarterly and annual financial reports for 2004 and 2005.

Mike Allen

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