Committee Probes Cendant Exec's Expense Reports

<B> Committee Probes Cendant Exec's Expense Reports</B>

By Maria P. Vallejo

<I>Parsippany, N.J.</I> - Cendant Corp. is continuing its investigation of alleged fraudulent travel expense reports and cash advances made by its former CEO and chairman, Walter Forbes.

The investigation into Forbes' expenses centers around a receipt for about $550,000 in cash advances and about $1.5 million in air, travel and lodging allowances dating from 1996 to April 1998. Although this is a separate issue from the current audit committee's investigation into CUC's accounting irregularities, it did stem from that discovery. Forbes was CUC's chairman of the board and CEO prior to the company's merger with HFS in December.

The Cendant audit committee report released late last month indicated that Forbes received more than $500,000 in September for "undercharging" the company for trips in 1995 and 1996. These trips were charged to CUC's reserve, which was established for the merger. The charging was dictated by Kirk Shelton, CUC's former president and CEO.

Shelton was officially terminated last month, denying him the severance pay he negotiated in April when he resigned. Forbes resigned in late July.

The expense reporting investigation resulted from the audit committee's discovery that CUC executives released fraudulent financial reports that were inflated by $500 million before taxes between 1995 and 1997.

Forbes is not the first executive in the past few years to be caught with fraudulent expense reporting. Nielsen North America fired several employees after they spent more than $191,000 in company funds in 1994. Kenneth Solomon was charged with improperly collecting $22,136 in the double-billing of Laventhol & Horwath's expense accounts in October 1992.