French regulators fined Vivendi Universal SA (V) and its former boss Jean-Marie Messier (search) nearly $1.4 million each on Tuesday for deceiving investors with a litany of inaccurate financial communications issued over a two-year period.

The Financial Market Authority's ruling, posted on its Web site, cleared Messier of insider trading but found that he consistently misstated cash flow in 2001-2002 and used false accounting to hide the true level of the media conglomerate's debt.

Messier, Vivendi's former chief executive and chairman, was forced out in 2002 after an acquisition spree that took the company close to bankruptcy and racked up $47 billion in debt.

When Vivendi was $4.6 billion in debt in October 2000, the ruling said, Messier "artificially reduced" the figure he reported to $1.6 billion by subtracting expected proceeds of a sell-off that took place 14 months later.

Messier's lawyer said his client would appeal the fine.

Vivendi declined to comment on the ruling but confirmed in a separate announcement that chairman and CEO Jean-Rene Fourtou (search) is to quit his executive role next year to chair a new supervisory board, subject to shareholder approval, with chief operating officer Jean-Bernard Levy taking over as chief executive. The plan had been widely reported.

In its ruling Tuesday, the AMF also found that Messier broke market rules and inflated Vivendi's results by incorrectly consolidating figures from Telco, its 49 percent-owned Polish subsidiary, but cleared him on similar allegations relating to two other Vivendi units, Cegetel and Maroc Telecom.

The AMF also cleared former Vivendi finance director Guillaume Hannezo of wrongdoing.

Messier, once revered as a symbol of a new French business dynamism, remains the subject of a separate judicial probe relating to his time at Vivendi.

Since Messier's departure from Vivendi, the company has sold off much of the empire he built up — including the Universal movie studios and other entertainment assets — and is now focused on telecommunications operations including mobile operator SFR and pay-TV unit Canal Plus (search). Net debt was $7.4 billion as of Sept. 30.

Despite the turnaround, accusations of mismanagement continue. In October, Vivendi confirmed that police had placed Fourtou under formal investigation over allegations that he made improper use of the company jet.

Vivendi shares closed 0.1 percent higher in Paris soon after the ruling was announced. In later New York trading, the company's U.S. shares slipped 19 cents, or 0.6 percent, to $30.27 on the New York Stock Exchange.