Boston, MA... The former Senior Vice President of worldwide sales at Interspeed, Inc. was convicted last Friday evening in federal court following a nine day trial on fraud charges stemming from his scheme to falsely inflate the sales and revenues of the now-defunct North Andover corporation.

United States Attorney Michael J. Sullivan and Kenneth W. Kaiser, Special Agent in Charge of the Federal Bureau of Investigation in New England, announced that ARTHUR A. GOODWIN, age 45, formerly of Boxford, Massachusetts and currently of Plano, Texas, was convicted by a jury sitting before U.S. District Judge Richard G. Stearns on eight counts of securities and wire fraud.

Evidence presented during the trial proved that GOODWIN served as Senior Vice President of worldwide sales at Interspeed from December, 1999 until he was terminated in October, 2000. Interspeed was a NASDAQ-listed Internet corporation that manufactured and sold high speed data communications equipment.

The evidence established that GOODWIN falsely overstated the sales and revenues of Interspeed by approximately $9 million, over 60% of the company’s publicly reported revenues, through various fraudulent acts. These included: inducing customers to place orders for Interspeed equipment by entering into secret side letters that provided the customers with the right to return the equipment at no cost, thus inflating the company’s apparent sales; fraudulently altering a key contract document on what purported to be the largest sale in Interspeed’s history so that the company’s internal finance staff and outside auditor would approve recognizing the revenue on the transaction; and taking various steps to evade discovery of the illusory nature of the foregoing sales. Through such conduct, GOODWIN inflated Interspeed’s revenues to make them appear higher than the revenues actually generated, thus causing Interspeed consistently to report to the public that it had met or exceeded its revenue targets when, in truth, Interspeed was not meeting its targets.

Interspeed’s Board of Directors did not discover GOODWIN’s fraudulent acts until late September, 2000, at which point the company terminated his employment and reduced its previously announced revenue figures by 60%. Following these disclosures, the price of Interspeed’s stock fell by more than 50 %, the company was delisted by NASDAQ, and it subsequently went out of business.

Judge Stearns scheduled sentencing for October 5, 2006. GOODWIN faces up to 20 years' imprisonment on each of the securities fraud counts, together with a fine of up to $5 million and restitution to the former shareholders of Interspeed.

The Securities and Exchange Commission filed a parallel civil proceeding against the defendant. The U.S. Attorney appreciates greatly the cooperation and assistance of the SEC in this matter.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorneys Michael J. Pineault and Jack W. Pirozzolo in Sullivan’s Economic Crimes Unit.

Press Contact: Samantha Martin, (617) 748-3139