The Securities and Exchange Commission has suspended a CPA who was the former senior treasury manager and assistant treasurer at Peregrine Systems, a California enterprise management software company that was charged in 2003 with massive financial fraud.

Ilse Cappel, 47, worked at the company from 1993 to 2002. The SEC alleged that Peregrine’s management engaged in deceptive sales and accounting practices, and that Peregrine filed materially false financial statements for at least 11 quarters, covering fiscal years 2000 and 2001, and the first three quarters of fiscal 2002. In one portion of the fraud, Cappel and others engaged in a scheme to conceal Peregrine’s difficulties in collecting its accounts receivable.

Those difficulties arose because Peregrine improperly recorded revenue on non-binding arrangements it entered into with customers. Cappel and the others concealed the accounts receivable problems by, among other things, selling fictitious receivables to banks and improperly accounting for cash collected at quarter end.

In addition, the complaint alleged, Cappel sold Peregrine stock while in possession of material nonpublic information about the fraud. According to the complaint, by engaging in this and other conduct, Cappel violated the antifraud provisions of the federal securities laws and the books and records, reporting, and internal accounting control provisions of the Exchange Act.

The SEC ordered on Wednesday that Cappel be suspended from appearing or practicing before the commission as an accountant.

Peregrine filed suit against its auditor Arthur Andersen in 2002 for $1 billion in damages, claiming the firm allowed incorrect audits that overstated revenues by as much as $250 million to be filed for the 2000-2002 fiscal years. In 2003, former Peregrine CFO Matthew Gless pleaded guilty to fraud, and in 2008, former CEO Stephen Gardner was sentenced to eight years and one month in jail for his role in the fraud, which resulted in bankruptcy for the company.

The company is now owned by Hewlett-Packard, which acquired it in 2005 for $425 million.

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