WASHINGTON, Nov 4 (Reuters) - The U.S. Securities and Exchange Commission:
* Says it charges Merge Healthcare Inc and two former executives of the medical software provider with accounting fraud.
* Says ex-CEO Richard Linden, ex-CFO Scott Veech engineered a process in which Merge improperly recognized revenue from sales not yet completed.
* Says the fraud caused Merge to overstate net revenue by about 26 percent and to overstate net income by about 230 percent in annual and quarterly reports from 2002 to 2005.
* Says the accounting fraud cost the company more than $500 million in market capitalization.
* Says that Merge, Linden and Veech each agreed to settle the charges without admitting or denying allegations; Linden to pay $590,000 and Veech to pay $280,000.
* Posts details at: http://www.sec.gov/news/press/2009/2009-233.htm

(Reporting by Julie Vorman; Company news desk in Washington; +1 202 898 8400, washington.newsroom@thomsonreuters.com)

COPYRIGHT

Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.