NEW YORK (CNN/Money) - AOL Time Warner Inc. Tuesday named Jonathan F. Miller chairman and CEO of the media conglomerate's ailing America Online division.

Miller, formerly president and CEO of USA Information and Services, a division of USA Interactive, is taking the reins at AOL during a difficult time. In addition to its flagging financial performance, AOL is the subject of Securities and Exchange investigations into its accounting practices and its relationship with software firm PurchasePro.

The move had been widely expected and was announced officially early Tuesday afternoon.

Miller, 45, will be responsible for all of America Online's businesses, including the flagship AOL service, and will report to Don Logan, chairman of AOL Time Warner's Media & Communications Group.

Jon Miller (Courtesy: USA Interactive)

"Jon's hiring represents an important step forward for America Online and the entire company," AOL Time Warner Chairman Steve Case said.

"The discussions I've had with Jon give me great confidence that he will put the focus squarely back on our members and ensure we strike the right balance between driving near-term growth and investing for the future," Case said.

Shares of AOL Time Warner (AOL: down $0.14 to $9.81, Research, Estimates) were down more than 2 percent in afternoon trade Tuesday amid a broader upturn in the stock market. The stock has been pressured recently amid growing concerns about a possible accounting scandal.

News surfaced last week that federal investigators turned their inquiry into accounting practices at AOL Time Warner's America Online division to the unit's relationship with PurchasePro. AOL Time Warner is the parent company of CNN and CNN/Money.

PurchasePro confirmed the investigation Tuesday and said it is cooperating with federal authorities. The business software developer said it has provided information to the SEC in response to separate inquiries regarding other companies.

The companies had an agreement in 2000 by which AOL would sell PurchasePro software in return for warrants to purchase shares in the Las Vegas-based company at a discount, according to previous news reports.

The top spot at the America Online unit has been vacant since April, when Barry Schuler resigned. Robert Pittman then assumed control of the unit as its chief operating officer, but in mid-July he also quit under pressure.

Pittman headed the division prior to AOL's acquisition of Time Warner, which was completed in January 2001. He also had been considered a contender for the position of AOL Time Warner CEO.

Miller is a longtime cable executive whose career has ranged from the National Basketball Association's cable operations to Nickelodeon and Home Shopping Network.

AOL, the nation's biggest Internet service provider, has been troubled by slowing subscriber growth and a sharp drop in advertising revenue. The service is set to unveil the latest version of its software this fall.