The New York Times
By ALEX BERENSON

The two former top executives at AremisSoft, a publicly traded software company, were accused yesterday by the Securities and Exchange Commission of defrauding investors of at least $200 million and possibly much more. The S.E.C. said it began to investigate AremisSoft after published articles suggested that the company had overstated the value of a contract it had won in 1999 to overhaul the health insurance system of Bulgaria.In a 32-page civil complaint filed in Federal District Court in New York, the commission contended that Roys Poyiadjis and Lycourgos K. Kyprianou, the former co-chief executives of AremisSoft, had engaged in one of the largest financial frauds in history. Mr. Poyiadjis and Dr. Kyprianou used false financial statements to inflate the price of AremisSoft`s stock, then sold millions of shares of AremisSoft to unwitting investors during late 2000 and early 2001, the commission alleged.About $89 million of the $120 million in sales that AremisSoft reported last year may never have existed, the complaint said. Mr. Poyiadjis resigned as chief executive of AremisSoft on Monday. Dr. Kyprianou had resigned on July 31.The full extent of the actions by Mr. Poyiadjis and Dr. Kyprianou is still uncertain, the S.E.C. said, because regulators have not yet been able to obtain complete records of all the shares the men sold.But the complaint contends that Mr. Poyiadjis made $175 million on his sales. Dr. Kyprianou made an additional tens of millions of dollars, and possibly much more, according to Richard Sauer, assistant director for the commission`s enforcement division.On Tuesday, at the request of federal attorneys in New York, authorities in the Isle of Man froze $175 million in two bank accounts controlled by Mr. Poyiadjis or his family, according to the complaint. That money came from Mr. Poyiadjis` sales of AremisSoft stock, the complaint said. So far, the S.E.C. said it has been unable to locate the proceeds of the sales by Dr. Kyprianou, the complaint said.The whereabouts of Dr. Kyprianou and Mr. Poyiadjis are also unclear. Dr. Kyprianou is a citizen of Cyprus and lives there, while Mr. Poyiadjis is a British citizen who has a home in New York City, according to the complaint. Mr. Sauer would not say whether authorities know where Mr. Kyprianou and Mr. Poyiadjis are, but he said neither man was in custody.A lawyer for Mr. Poyiadjis did not return telephone calls for comment. Dr. Kyprianou could not be reached for comment. Paul Bloom, AremisSoft`s executive vice president, said the company was continuing to cooperate with the S.E.C. and other authorities.

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