CONCORD, N.H. (AP) — The former chief financial officer of Enterasys has asked a federal court to overturn his fraud conviction — and has accused former New Hampshire Gov. Craig Benson and U.S. Attorney Tom Colantuono of wrongdoing in the process.
Robert Gagalis, formerly of Rye, is serving 111/2 years in federal prison in Fort Dix, N.J., for his role in a conspiracy to inflate Enterasys revenues in 2001.
Enterasys, a computer networking company formerly based in Rochester, has since moved to Andover, Mass. It was a spinoff of Cabletron Systems Inc., which was co-founded by Benson and dissolved in 2001 after its stock plummeted and stockholders filed a lawsuit against the company and several of its directors, including Benson. Enterasys agreed to pay $10.5 million to settle the suit in 2006.
Benson, who was governor from 2003 to 2005, was once Enterasys's biggest shareholder, along with serving on the company's board and audit committee. He has not been charged with any crime.
In his filing, Gagalis describes Benson as a significant participant in Enterasys decisions, one who criticized auditors and fought Gagalis's efforts to overhaul how the company counted revenue.
Gagalis also criticized Colantuono for not recusing himself from the Enterasys investigation for two years despite his "long-standing political and personal relationship with Benson."
Harvey Wolkoff, Benson's lawyer, strongly denied the accusations, saying the source of the allegation is suspect. He said Benson fully cooperated with the U.S. Attorney's Office.
"Mr. Benson was not involved at all in any wrongful activity. In fact, he was a proponent of uncovering it and bringing it to the attention of the U.S. Attorney's Office," Wolkoff said. "So Mr. Gagalis's petition is 'Alice in Wonderland.' He's been convicted, and he's now blaming everyone else."
Colantuono's office said in a statement that it would respond to Gagalis's allegations in time to meet court deadlines.
Colantuono, who was a member of the Executive Council from 1999 to 2001, before he was appointed U.S. attorney, approved contracts with Cabletron.
"At no time did Tom Colantuono make any effort or have any impact on any decision relating to the prosecution or non-prosecution or any employee direction," Robert Kinsella, who served as acting U.S. attorney on the case, told New Hampshire Business Review.