Azteca seeks to settle with SEC

Proposed deal would exclude TV Azteca from any fine

MEXICO CITY — TV Azteca, Mexico’s No.2 web, said Monday it had proposed to U.S. regulators a settlement of fraud charges filed last year against the company and its billionaire owner, Ricardo Salinas Pliego.

Complications in the U.S. Securities and Exchange Commission’s case against Salinas Pliego could push the commission to accept the offer.

The company said in a statement that the proposed deal would exclude TV Azteca from any fine. Salinas Pliego and another exec, Pedro Padilla, likely are offering to pay fines without admitting to wrongdoing. The company did not provide details of the proposed settlement.

The SEC in early 2005 charged TV Azteca, Salinas Pliego and two other execs for concealing a debt deal from investors that personally netted Salinas $109 million.

The charges, presented at the beginning of 2005, marked the first time tough securities legislation enacted under the Sarbanes-Oxley Act was applied to a foreigner.

It may be the last.

Trail was stalemated due to the inability to effectively serve legal papers to Salinas in Mexico.

After failing more than 20 times to serve papers, SEC lawyer Harold Loftin reportedly was seeking to convince the judge last week to allow prosecutors to publish the official notice in Mexican papers.

According to local daily Reforma, the SEC lawyer Harold Loftin then filed legal papers with the court Friday asking for 90 days to consider the defendant’s proposed settlement.

Loftin was unavailable for comment.

Salinas Pliego, president and chairman of the board of TV Azteca, pulled the shares of TV Azteca and two of his other companies from trading in New York last year.

That insulated him from perhaps the stiffest penalty the SEC was seeking — that Salinas Pliego step down from executive and board positions in any company trading Stateside.

Salinas Pliego, who managed to nearly double his personal fortune to $3.1 billion during 2005 according to Forbes, is president and chairman of TV Azteca and also owns discount retailer Elektra and mobile telco Unefon.

Meanwhile, in Mexico, the Finance Ministry last year reportedly asked federal prosecutors to bring the nation’s first case of insider-trading charges against Salinas Pliego over the debt deal.

But Mexican prosecutors have not yet filed any charges.

U.S. prosecutors had been hoping Mexican authorities would impose fines that would bolster their case against Salinas, according to a person familiar with the matter.

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