Business

Ex-Homestore CEO set to plead guilty in fraud case

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LOS ANGELES (AP) — The former CEO and chairman of Homestore Inc. is scheduled to plead guilty Tuesday to conspiring to commit securities fraud in a scheme to inflate the company’s revenue to win over Wall Street analysts.

Stuart Wolff is expected to appear in U.S. District Court in Los Angeles. He faces a prison sentence of three to five years.

A jury convicted Wolff in 2006 of more than 12 criminal charges stemming from the complex fraud scheme and he was sentenced to 15 years in prison. However, the 9th U.S. Circuit Court of Appeals overturned the conviction, ruling that the trial judge should have been recused.

The plea agreement will close a case that resulted in the convictions of 11 other defendants and caused Homestore shareholders to lose more than $100 million when the company’s stock price plummeted in 2001 on news of the federal investigation into irregular accounting practices.