Three former Nortel Networks Ltd. executives, including past CEO Frank Dunn, have been charged with fraud by the Royal Canadian Mounted Police (RCMP), culminating a four-year investigation.

Dunn, former Nortel CFO Douglas Beatty, and former corporate controller Michael Gollogly were charged today on seven counts apiece. Charges include fraud affecting the public market and falsification of books and documents, as well as their alleged roles in the issuing of a false prospectus.

The RCMP claims the three former executives "made false entries and omitted materials particular in the books and documents in regards to the financial results of Nortel" during the period between Jan. 1, 2002, and June 30, 2003.

Nortel itself was not under investigation; in fact, the company participated in the investigation, as did the FBI and the Securities and Exchange Commission (SEC) . (See Ex-Nortel Execs Charged.)

So continues Nortel's long post-bubble saga. In the first quarter of 2003, it looked like Nortel had climbed back to profitability. But it wasn't the case; Nortel ended up restating earnings going back to 2000.

That led to Dunn, Beatty, and Gollogly being fired in 2004, though Dunn didn't officially leave Nortel's board until a month later. (See Nortel Fires CEO, Nortel Stock Dives on Dunn Downfall, and Dunn's Done With Nortel .)

The headaches didn't stop there. Dunn and other executives were given bonuses for achieving profitability that, according to the restatements, didn't happen in the first quarter of 2003 (although Nortel did turn a profit in the second quarter that year). In 2005, Nortel sued to get those bonuses back. (See Nortel Silent on Baffling Bonuses and Nortel Sues Former Executives.)

In turn, Dunn, Beatty, and Gollogly sued Nortel at different times in 2006 for wrongful dismissal, according to Nortel's SEC filings.

Shareholders got into the game, of course, with class action lawsuits. Nortel offered a cash-and-stock settlement worth $2.2 billion as of late 2006. The settlement took effect in March 2007, according to SEC filings. (See Nortel Takes $2.5B Hit and Nortel Nears Shareholder Settlement.)

And the SEC itself didn't sit still through all this. It opened an investigation in 2004 that led to civil charges against at least eight former executives, including the three charged by the RCMP today. (See SEC Pops In on Nortel, SEC Charges Four More Ex-Nortelers .) Meanwhile, Nortel settled its own SEC case for $35 million late last year. (See Nortel Does Deal with SEC.)

— Craig Matsumoto, West Coast Editor, Light Reading