Chip maker Microsemi has decided to keep its CEO and president James Peterson after a board investigation concluded he lied about receiving degrees from Brigham Young University.
The California-based firm specializes in high-reliability parts the US government uses in military applications, satellites, and spacecraft.
The board investigation determined Peterson didn't obtain the Bachelor's Degree or Masters of Business Administration he had listed on regulatory filings and a US government security clearance application for STEC, where he serves as a director.
An independent inquiry was made on behalf of the board by the law firm Munger, Tolles & Olson following media reports late last year which uncovered the deception.
Microsemi said that as a penalty for misrepresenting his academic credentials, Peterson will immediately pay $100,000 to the company. He will also forgo his 2008 bonus — which is terrific timing since so many tech company CEOs are waiving their bonuses anyway because of the US recession. Microsemi said for the past three years, Peterson's annual bonuses average about $680,000.
The company pointed out that Peterson did earn an Associate's Degree from Ricks College (now known as Brigham Young University, Idaho) on December 15, 1978. It also claims he earned "substantial credits" towards and Bachelor's Degree at Brigham Young University form 1979 through 1980.
The chief was first fingered by Barry Minkow, co-founder of the Fraud Discovery Institute.
Microsemi responded with a statement from Peterson saying he "categorically" denied the reports. He suggested the background check may have mistakenly made with the name "James J. Patterson," instead of his own.
He also questioned the reliability of Minkow as a source, citing that he is a convicted felon who spent seven years in prison, from 1988 to 1995, after being convicted of fraud while running the a firm called ZZZZ Best Co.
"I have every reason to expect that Brigham Young will investigate this allegation shortly and officially confirm my degrees," Peterson had stated.
The next day, the registrar of Brigham Young told Bloomberg they had double-checked and still didn't turn up the degrees.
Microsemi said as a result of the recent investigation, it will conduct background checks on its current and future officers and directors. The board said it will amend the company's code of ethics to make it clear that lying about one's credentials is a violation of business ethics and can get you in trouble.
(In related news, no $%*#ing duh.)
"Despite the results of the inquiry, we recognize that our Chief Executive Officer, Jim Peterson, has built a highly successful and profitable enterprise at Microsemi during the past nine years, with a strong business plan and vision for the future," said Dennis Leibel, chairman of Microsemi's board of directors in a statement.
The company is presently fighting an antitrust lawsuit from the US Department of Justice over its $25m buy of rival Semicoa Semiconductors. ®