By Larry Rulison, BBJ Staff

Former Network Technologies Group Controller Beverly Baker of Catonsville pled not guilty in U.S. District Court in Baltimore Tuesday afternoon to charges she and three other company executives doctored financial records to get more than $5 million in loans and venture capital for the now-defunct Fells Point telecommunications firm.

Baker, 51, was indicted Jan. 22 on ten counts of fraud along with Michele Tobin, NTG's former CEO; Victor Giordani Jr., the former chief operating officer, and Thomas Bray, the former chief financial officer. Each count carries a maximum penalty of 30 years in prison and a $1 million fine.

Federal prosecutors allege the four conspired to mislead their bank, Mercantile-Safe Deposit & Trust Co., and two venture capital firms into thinking the company was more profitable than it was. The company shut down and laid off all 125 workers July 12 after the alleged fraud was uncovered by John M. Collard, an Annapolis consultant hired by the firm's board after Tobin resigned. NTG laid telecommunications equipment underground. Clients included Comcast, Baltimore Gas & Electric Co. and AT&T Corp.

Baker was the first of the four to appear in court. Giordani is scheduled to appear Wednesday.

Baker spoke quietly to Magistrate Judge James K. Bredar alongside her attorney, David P. Henninger, of Bel Air. She pled not guilty and the judge released her on her own recognizance. Her case is scheduled to go to trial the week of April 7 in front of District Judge J. Frederick Motz.

After the proceedings, Baker declined to comment to the Business Journal. However, Henninger said in an interview that Baker was only trying to do her job and was not making any of the decisions that led company officials to mislead the bank and investors. He said a jury would find her not guilty.

"She was not in the loop. She did the accounting," Henninger said. "She was just trying to keep the business going."

Henninger said Baker made approximately $65,000 a year as controller. He said that at one point she loaned the company $50,000 and during the last three weeks of the company's existence, she took no salary.

Assistant U.S. Attorney Dale P. Kelberman said that the four defendants would be tried together if their cases go to trial. However, he would not say whether or not any of the defendants were prepared to plead guilty or strike a deal with prosecutors.

"I can't comment," Kelberman said. "I can't say anything."

Reached at home Wednesday afternoon, Giordani declined to comment. His attorney, Ricardo Zwaig, said Giordani would plead not guilty Wednesday.

"Mr. Giordani is not guilty," Zwaig said. "I hope everyone will hold off judging him until this matter is resolved."

Bray is scheduled to first appear in court on Feb. 27. His lawyer, Gerald Ruter, would not say how Bray would plead.

"We'll have to wait and see what happens," Ruter said. "The indictment is sweeping. The Tom Bray that I know doesn't bear any relationship to that indictment. He is a fine and decent man. He will do the right thing."

Tobin is scheduled to appear in court on Feb. 20. After quitting her job at NTG, she sold her Baltimore County home and moved into a house outside Vail, Colo. She could not be reached for comment. She filed for Chapter 7 bankruptcy in December.

Ruter said Tobin is being represented by Joseph Sedwick Sollers of King & Spaulding LLP in Washington, D.C. Sollers' name has appeared on civil court documents related to Mercantile's claims against Tobin in Baltimore County Circuit Court. He did not immediately return a call seeking comment. Sollers represented President George H. Bush in the Iran-Contra hearings.

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