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Cat shifts new exec to head bilked mining division

Fri, 15 Feb 2013 12:23:49 CST
By: Charlie Schlenker

Caterpillar, Incorporated has moved its Vice President of earth moving equipment to its mining products division in the wake of what the company calls significant accounting misconduct at a subsidiary in China bought by the Peoria company last year. The decision to transfer Tom Bluth to new duties comes only a week after Caterpillar's Presiding Board member Ed Rust Junior declined a GLT question on how the company would try to prevent future problems like the one that resulted in a 580 million dollar write-off.

"There is a tremendous amount of material that Caterpiller has already put out and a number of analysts in the investment community have spoken on and I would defer to them."

Reporting in Forbes Magazine raises the possibility that Caterpillar should have paid more attention to a huge amount of past due receivables at Siwei,(SEE-way) a subsidiary of ERA Mining that might have tipped off executives to the inventory discrepancies only discovered after the purchase. Other reports indicate Siwei used a reverse merger with ERA to achieve listing on the Hong Kong stock exchange without some of the revealing regulatory disclosure that could also have turned up key information before Caterpillar's purchase. The previous Vice President for mining has already departed Caterpillar. Other companies have been bitten in recent years by the practice, but none so large as Caterpillar. The new VP for Mining, Tom Bluth has degrees in law, engineering, and business and a previous position that gave him experience in Asia.

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