CHS Electronics is a former multinational distributor of microcomputer products,

personal computer A personal computer (PC) is a multi-purpose microcomputer whose size, capabilities, and price make it feasible for individual use. Personal computers are intended to be operated directly by an end user, rather than by a computer expert or tec ...

peripherals A peripheral or peripheral device is an auxiliary device used to put information into and get information out of a computer. The term ''peripheral device'' refers to all hardware components that are attached to a computer and are controlled by the ...

, networking products, and

software Software is a set of computer programs and associated documentation and data. This is in contrast to hardware, from which the system is built and which actually performs the work. At the lowest programming level, executable code consists ...

. It was based in

Miami, Florida Miami ( ), officially the City of Miami, known as "the 305", "The Magic City", and "Gateway to the Americas", is a East Coast of the United States, coastal metropolis and the County seat, county seat of Miami-Dade County, Florida, Miami-Dade C ...

from its 1994 founding to its 2000 collapse.Businessweek: Overview of CHS Electronics, Inc.
/ref>

Description

The company sold hardware and software products such as

local area network A local area network (LAN) is a computer network that interconnects computers within a limited area such as a residence, school, laboratory, university campus or office building. By contrast, a wide area network (WAN) not only covers a larger ...

disk drive Disk storage (also sometimes called drive storage) is a general category of storage mechanisms where data is recorded by various electronic, magnetic, optical, or mechanical changes to a surface layer of one or more rotating disks. A disk drive is ...

printer Printer may refer to: Technology * Printer (publishing), a person or a company * Printer (computing), a hardware device * Optical printer for motion picture films People * Nariman Printer (fl. c. 1940), Indian journalist and activist * James ...

s, personal computers, random access memory chips,

central processing unit A central processing unit (CPU), also called a central processor, main processor or just Processor (computing), processor, is the electronic circuitry that executes Instruction (computing), instructions comprising a computer program. The CPU per ...

s and integrated circuit boards. The principal vendors of the company included Seagate Technology, Hewlett-Packard,

Microsoft Microsoft Corporation is an American multinational technology corporation producing computer software, consumer electronics, personal computers, and related services headquartered at the Microsoft Redmond campus located in Redmond, Washing ...

, IBM, Sun and Creative Labs,

3Com 3Com Corporation was an American digital electronics manufacturer best known for its computer network products. The company was co-founded in 1979 by Robert Metcalfe, Howard Charney and others. Bill Krause joined as President in 1981. Metcalfe ex ...

Epson Seiko Epson Corporation, or simply known as Epson, is a Japanese multinational electronics company and one of the world's largest manufacturers of computer printers and information- and imaging-related equipment. Headquartered in Suwa, Nagano ...

, and

Intel Intel Corporation is an American multinational corporation and technology company headquartered in Santa Clara, California. It is the world's largest semiconductor chip manufacturer by revenue, and is one of the developers of the x86 seri ...

. It was a leading international distributor of microcomputers, peripherals, and software to more than 130,000 resellers in 46 countries in

Europe Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a Continent#Subcontinents, subcontinent of Eurasia ...

, Latin America,

Asia Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...

, the

Middle East The Middle East ( ar, الشرق الأوسط, ISO 233: ) is a geopolitical region commonly encompassing Arabian Peninsula, Arabia (including the Arabian Peninsula and Bahrain), Anatolia, Asia Minor (Asian part of Turkey except Hatay Pro ...

and

Africa Africa is the world's second-largest and second-most populous continent, after Asia in both cases. At about 30.3 million km2 (11.7 million square miles) including adjacent islands, it covers 6% of Earth's total surface area ...

, until its bankruptcy due to an investigation of

tax fraud Tax evasion is an illegal attempt to defeat the imposition of taxes by individuals, corporations, trusts, and others. Tax evasion often entails the deliberate misrepresentation of the taxpayer's affairs to the tax authorities to reduce the taxp ...

. The companies customers include assemblers of non branded component products and resellers.

History

It was founded by Venezuelan entrepreneur

Claudio Osorio Claudio Osorio (born November 16, 1958) is a Venezuelan entrepreneur and businessman based in Miami, Florida. He rose to prominence in the late 1990s (Osorio was named "entrepreneur of the year" by Ernst & Young in 1997) due to the expansion of h ...

in 1994. He was sent to prison in 2012, after a federal judge sentenced him to 12½ years, for running a $40 million investment fraud through

InnoVida InnoVida was a manufacturer of building materials, founded by businessman Claudio Osorio. It entered bankruptcy in 2011, one in a string of companies taken into bankruptcy under Osorio's leadership. History * 25 April 2007, the Osorios were in ...

, another one of his companies. According to an indictment, between 2006 and 2011 Osorio conspired to steal $40 million from 10 investors and an additional $10 million from a federal government program. CNN.com: "Jeb Bush missed red flags in Florida business scandal"
re: Claudio Osorio + InnoVida; 30 March 2015.

Mergers

In 1997 the company acquired Karma International for $160 million. In 1998, the company acquired Metrologies International SA, subsidiaries of SiS Distribution Ltd, and 14 other acquisition. That year CHS Electronics ranked number 320 on the 1998 Fortune 500 list of the largest U.S.-based industrial corporations, with sales of $7.5 billion and net income of $87.9 million for the last four quarters. It was one of the few South Florida businesses on the Fortune 500 list of top-selling U.S. firms then.

Demise

The company reported a $45 million accounting discrepancy that ended up cutting its 1998 profits by about half.Sun Sentinel.com: "CHS Has $45 Million Problem"
23 March 1999. Due to the massive operating losses, due to problems managing its large debt and losing money,Sun Sentinel.com: "CHS Goes Looking For Cash"
17 September 2009. in 1999 it was forced to sell its subsidiaries in Europe and Latin America. The company also cut 10% of its workforce that year. The company filed for Chapter 11 bankruptcy in February 2000.Sun-sentinel.com: "CHS Files Chapter 11, Seeks New Direction"
5 April 2000; by Doreen Hemlock. The company ceased operations and was liquidated later in 2000.

Class action lawsuit

class action lawsuit A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class actio ...

was filed in 2000, alleging securities fraud after the company collapsed.
/ "CHS Electronics (NYSE:CHS) a leading international distributor of computer products was today charged in a class action lawsuit with deliberately avoiding European Value Added Taxes (VAT) in order to fraudulently increase company profits and inflate the CHS" Shareholders sued CHS and its executives, accusing them of misleading investors, artificially inflating CHS' stock price, overstating profits and income, and fraudulently reducing expenses. The suit accused Osorio of personally manipulating the company's financial statements to show a profit, a practice referred to internally as "Claudio's magic." Osorio and other CHS executives settled the suit for almost $12 million.LegalMetri
"Darby, et al v. CHS Electronics Inc, et al"

References

External links

* {{DEFAULTSORT:Chs Electronics 1994 establishments in Florida 2000 disestablishments in Florida Accounting scandals American companies established in 1994 American companies disestablished in 2000 Companies based in Miami Companies that filed for Chapter 11 bankruptcy in 2000 Computer companies established in 1994 Computer companies disestablished in 2000 Defunct companies based in Florida Defunct computer companies of the United States Defunct computer hardware companies Software companies based in Florida Software companies established in 1994 Software companies disestablished in 2000