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Harrisburg - Former Rite Aid executive Martin Grass is expected today to become the first c.e.o. to admit to criminal fraud since the wave of highly publicized accounting scandals began making headlines more than two years ago, reports the Associated Press.
Grass, son of Rite Aid founder Alex Grass, was indicted on 35 charges relating to his alleged involvement in $1.6 billion scheme designed to inflate shares in what was then the nation's No. 3 drugstore chain.
U.S. attorney Thomas Marino said in a statement that Grass is scheduled to appear in a Harrisburg, Pa., federal court today to change his "not guilty" plea.
Though prosecutors did not say whether Grass, who left Rite Aid in 1999, would swap his original plea for "guilty" or "no contest." Observers, however, say a no contest plea would be highly unusual for the 49-year-old Grass, who staunchly maintained his innocence from his first indictment last June until this week.
His trial was set to begin earlier this month, but Rite Aid's ex-finance chief Franklyn Bergonzi delivered a blow to Grass' defense when he entered a surprise guilty plea on a single conspiracy count June 5 and agreed to cooperate with prosecutors.
Bergonzi's plea deal followed a guilty plea last July from Timothy Noonan, the successor to Grass as interim c.e.o., who was expected to testify that Grass had helped investigators make secret tape recordings of conversations with Grass and Brown.
Rite Aid stock, which reached a high of $51.13 while the company was inflating profits, closed up 41 cents to $4.43 yesterday.