The New York City drug store chain was purchased by Walgreens back in February of 2010 but the time where he was in violation on stating company value goes back to the years 2000 to 2004. Walgreens paid $1.1 billion for the acquisition of Duane Reade Drugs and was formerly owned by private equity firm Oak Hill Capital Partners. BD
Mr. Cuti was convicted in June 2010 of securities fraud after a two-month trial in which jurors concluded he had plotted to falsely inflate the income and reduce the expenses that Duane Reade reported to investors. The Securities and Exchange Commission said Mr. Cuti and another executive at the company overstated the chain’s pretax income by $17.5 million between 2000 and 2004.
Judge Batts acknowledged that Mr. Cuti had rescued Duane Reade from the brink of bankruptcy, helping it grow into the metropolitan area’s largest drugstore chain, but she said he also “bullied people into committing fraudulent acts to make the company look like it was doing better than it actually was.”