SEC

A&A

Google IPO Sparks Excitement among Investors, Wall Streeters

First Google became a verb: Have you goggled today?
Community News

Pending Suit, Board Tenure Add to Grasso's Troubles

With both sides digging in and no sign of a settlement, New York Attorney General Eliot Spitzer is expected to soon bring suit to recoup some of the $139.5 million in compensation paid to former New York Stock Exchange Chairman Richard Grasso.Regulators working on the investigation have subpoenaed current and former Big Board directors who approved the excessive compensation packages. The subpoenas signify a broadening of the investigation, which until now had focused on Grasso and Kenneth G.
Tax

Computer Associates Chief Steps Down

As a federal criminal investigation into securities fraud and obstruction shifts in his direction, Sanjay Kumar, resigned yesterday as Computer Associates’ chairman and chief executive, the New York Times reported. The fourth-largest independent software company, CA is based in Islandia, NY. With his resignation, Kumar becomes the latest in a string of chief executives to be caught in the crossfire as accounting scandals have rocked U.S. companies.
Tax

Scrushy Must Repay $25 Million Loan to HealthSouth

Upholding a lower court ruling, the Delaware Supreme Court ruled on Thursday that HealthSouth’s founder and former chief executive Richard Scrushy must pay back a $25 million loan to the company.In July 2002, Scrushy repaid the loan using HealthSouth shares, which tanked just after the repayment when he warned of lower-than-expected profits and said he planned to reorganize the company, Reuters reported.The stock decline was the reason the company sued him after he was accused of being behind a $2.7 billion fraud, which he denies even though he faces 85 federal counts of fraud and cons

Computer Associates Fires Nine as Federal Probe Continues

As part of an ongoing federal investigation into its accounting practices, Computer Associates International Inc. fired nine employees Monday, all members of the finance and legal departments, the Wall Street Journal reported.None of the fired employees was a member of the Islandia, NY, company’s executive management team.
Community News

Ernst & Young Suspended from Taking New Audit Clients for Six Months

Arguing that Ernst & Young engaged in "improper professional conduct" an administrative law judge on Friday suspended the Big Four accounting firm from accepting new publicly traded companies as audit clients for six months and ordered the company to make $1.7 million in restitution, the Wall Street Journal reported.The case was brought by the enforcement division of the Securities and Exchange Commission, which claimed auditor independence issues in Ernst’s relationship with audit client PeopleSoft.

SEC Adopts Fund Disclosure Rules and Foreign Bank Loan Exemption

The Securities and Exchange Commission on Tuesday voted to adopt a rule and form amendments designed to provide foreign banks under certain conditions exemption from insider lending prohibitions; to propose for comment new rules regarding shell companies, "reverse mergers" and use of securities registered on Form S-8; and voted to adopt disclosure requirements for investment companies regarding their policies and procedures on market timing, fair valuation and selective portfolio disclosure.Disclosure Regarding Market Timing, Fair Value Pricing, and Selective Disclosure of Portfolio Hold
Tax

Computer Associates Officials Plead Guilty

Another corporate official has pled guilty to charges related to accounting fraud. David Rivard, 36, former vice president of finance at Computer Associates, pleaded guilty yesterday morning in Federal District Court in Brooklyn.Rivard admitted to obstructing the government’s investigation of accounting irregularities at the company and conspiring to commit securities fraud, the New York Times reported. David Kaplan, a former senior vice president, and Ira H.
A&A

SEC Rethinking Late Trade Crackdown

The Securities and Exchange Commission may offer alternatives to its plan to stop late trading in mutual funds.While Chairman William Donaldson defended the 4 p.m. "hard close" proposal before the Senate Banking Committee Thursday, he acknowledged the concerns. The SEC has received almost 1,100 formal comments, mostly in opposition, the Chicago Tribune reported.Many investors and retirement plan administrators oppose the plan, which would require all mutual fund trades to be placed with the fund firm — not just brokers — by 4 p.m. Eastern time to receive that day’s price.

SEC Publishes Notice of PCAOB Standard on Wording in Audit Reports

The Securities and Exchange Commission this week published a notice soliciting public comments on Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 1, entitled "References in Auditors' Reports to the Standards of the Public Company Accounting Oversight Board." If approved by the Commission, Auditing Standard No.

SEC Subpoenas Four MarketWatch Executives in Calandra Probe

The Securities and Exchange Commission stepped up its investigation into former MarketWatch.com Inc.

Congressmen Ask SEC to Rethink Late Trading Rule

A proposed rule to halt mutual fund trades after 4 p.m. may hurt investors more than help them, two congressmen told the Securities and Exchange Commission.The SEC made the proposal in mid-December as a way to help clean up trading abuses in the mutual fund industry. But according to the Wall Street Journal, Reps.
A&A

SEC Investigates Executive Compensation at Tyson Foods

The Securities and Exchange Commission is investigating Tyson Foods Inc., looking into the compensation paid to the company’s officers, including Chief Executive Officer John H. Tyson, 50, grandson of the company’s founder.The world’s largest meat processor acknowledged that the SEC’s probe has shifted from informal to formal, Bloomberg reported.According to company filings with the SEC, Tyson received a 2003 salary of $993,590 plus a $2.5 million bonus and $325,286 in “other compensation.” He was elected chairman in 1998 and became chairman in 2000.

Putnam Says Ex-CEO Hid Abuses, Fights SEC Fines

Putnam Investments accuses its ex-CEO of covering up improper trading at the company, which is planning to fight the Securities and Exchange Commission over fines levied in the case.In documents released by the SEC this week, Putnam wrote that former CEO Lawrence Lasser knew employees were violating company rules but said nothing in order to protect his compensation, which totaled more than $100 million over the last five years."When it came time to respond to evidence of market timing by Putnam employees, Lasser made a conscious decision to stick his head in the sand," Putnam said in th
Community News

SEC to Take Hard Look at Off-Balance-Sheet Disclosures

Off-balance-sheet transactions, once abused by Enron to hide debt and overstate profits, will be closely scrutinized as regulators look for ways to improve financial disclosures.That warning came from Donald T. Nicolaisen, chief accountant of the Securities and Exchange Commission, according to the Wall Street Journal. Nicolaisen said at a Financial Accounting Standards Advisory Council meeting Tuesday that the agency will study the details about off-balance-sheet activity that companies provided in their latest filings.
Tax

Skilling Pays Lawyers $23 Million Before Assets Frozen

High-profile lawyers don’t come cheap, especially when you are former Enron CEO Jeffrey Skilling, who faces criminal and civil cases that could drag on for years.Court documents show that Skilling paid his Houston attorneys $23 million toward his defense before his assets worth $55 million were frozen by the government, the Associated Press reported. Among the assets frozen were Skilling’s homes. "It sounds like a lot at first. But based on the number of cases Mr.
Tax

College 529 Plans Under Scrutiny, SEC Says Fees Paid May Offset Tax Benefits

Rep. Michael Oxley, a co-sponsor of the 2002 Sarbanes-Oxley accounting industry reform legislation, has set his sights now on what he calls high fees parents pay to save for college through state-run 529 plans.Bloomberg reported this week that Oxley, chairman of the House Financial Services Committee, said he may call for hearings on the regulation of 529 plans since they involve "perhaps one of the most important decisions a parent has to make -- that is, creating enough capital for their kids"' to go to college.
Tax

Bank of America to Pay $375 Million, Exit Mutual Fund Clearing Business

The Securities and Exchange Commission announced a settlement agreement in principle with Bank of America of securities fraud charges arising from arrangements to permit timing in certain Nations Funds mutual funds and for facilitating market timing and late trading by certain customers. The agreement in principle is subject to the approval by the Commission. Bank of America has agreed to pay a total of $375 million, consisting of $250 million in disgorgement and $125 million in penalties.
Community News

SEC Votes To Adopt Additional 8-K Requirements

The U.S. Securities and Exchange Commission today voted to publish for comment proposed amendments to Form 20-F, to adopt additional reporting requirements on Form 8-K and to publish for comment proposed disclosure requirements for portfolio managers of mutual funds and other registered management investment companies.1.

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