Washington (Feb. 27, 2003) -- The Securities and Exchange Commission on Wednesday accused two former Kmart Corp. vice presidents of masterminding a $42 million accounting fraud.The federal suit, filed in Michigan, said Enio Montini and Joseph Hofmeister made a long-term deal with a vendor, American Greetings Corp., under which Kmart would get an "allowance" of about $42 million on June 20, 2001.

Generally accepted accounting principles, as well as the company's own accounting policies, required that the money be recognized over the term of the agreement.

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