Home / Today's Top Stories / Former SRS CFO pleads
guilty to embezzlement

Former SRS CFO pleads
guilty to embezzlement

Former Scientific Radio Systems Inc. chief financial officer Thomas Herstine has pleaded guilty to embezzling more than $40,000 from the financially troubled Rochester company.
He is scheduled for sentencing Oct. 10.
Herstine did not personally pocket the funds–taken from employees’ 401(k)-plan contributions–but wrongly used the money to shore up the firm’s finances, said Richard Resnick, an assistant U.S. attorney in the Justice Department’s Rochester office.
Resnick said the former SRS official was caught in a nationwide probe of 401(k) finances in which the U.S. Department of Labor is auditing some 600 such plans around the country.
He declined to comment on whether any other Rochester firms are being audited in the Labor Department probe.
Resnick said that Herstine took the money over a two-year period between 1992 and 1995, wrongly using some $40,000 in employee contributions and $5,000 in company money that should have gone into employee 401(k) accounts.
A manufacturer of high-frequency radio systems used primarily for communications in Third World countries, SRS filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code last year. The case has since been converted to a Chapter 7 liquidation and the firm’s assets sold to an investor.
It is still turning out radios at its Rochester plant, said Paul Cherin of Tech Ventures Inc.
Tech Ventures was among several investors in SRS that lost money in the radio company’s bankruptcy.
SRS has a good product and a good market, but it suffered from chronically poor management under Herstine and two other partners who ran SRS and six other companies, Cherin said.
Another firm the three ran, the Ithaca Gun Co., also was driven to bankruptcy.

Former SRS CFO pleads
guilty to embezzlement

Former Scientific Radio Systems Inc. chief financial officer Thomas Herstine has pleaded guilty to embezzling more than $40,000 from the financially troubled Rochester company.
He is scheduled for sentencing Oct. 10.

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