Washington: Prabhat K Goyal, Vice President and Chief Financial Officer of the computer security firm Network Associates, famous for the McAfee anti-virus software, faces criminal charges for masterminding an accounting scam that duped investors by inflating the company's sales figures and concealing losses worth $ 330 million.

According to the civil fraud charges filed against him by Securities and Exchange Commission (SEC) yesterday, Goyal engaged in a fraudulent scheme to overstate the Santa Clara, California-based company's revenue and earnings in violation of the federal securities laws from the second quarter of fiscal 1998 through the fourth quarter of fiscal 2000.

The 20-count indictment presented at the San Francisco Court also alleged that Goyal sold stocks while in possession of material non-public information regarding the financial fraud at Network Associates.

The SEC complaint alleged Network Associates oversold products to its distributors and Goyal oversaw the improper recognition of millions of dollars of revenue.

Goyal and others at his direction used a wholly-owned Network Associates subsidiary to repurchase products previously sold to distributors in order to reduce distributor inventory levels and limit product returns, the SEC said.

He made secret payments to distributors to induce them to hold excess inventory and buy more products, and offered deep discounts and rebates on amounts they already owed to Network Associates for prior product purchases from which the company already had recorded revenues. If convicted, Goyal faces up to 10 years in prison.