SEC Charges Video Management Company Executives With Accounting Fraud
The Securities and Exchange Commission today announced accounting fraud charges against two former top executives of a now-bankrupt online video management company, accusing them of falsifying financial statements to make the company appear more profitable than it was in reality. The SEC alleges that then-CEO Kaleil Isaza-Tuzman and then-CFO Robin Smyth employed a variety of schemes to manipulate KIT Digital’s books and mislead investors, including an off-the-books slush fund used to generate payments back to the company and create the false appearance that KIT Digital was being paid for its products. In a parallel action, the U.S. Attorney’s Office for…
Read MoreSmeeta Ramarathnam Named Deputy Director in the Office of Credit Ratings
The Securities and Exchange Commission today announced that Smeeta Ramarathnam has been named Deputy Director in the Office of Credit Ratings. She begins her new role later this month. In this new position for the office, Ms. Ramarathnam will provide leadership and direction for various office activities including examinations and monitoring of nationally recognized statistical rating organizations (NRSROs), rulemaking, and related initiatives. Ms. Ramarathnam joins the office after serving for the past seven years as Chief of Staff for Commissioner Luis Aguilar. “Smeeta brings considerable securities and regulatory experience that will serve the office well,” said Thomas Butler, Director of…
Read MoreSEC Charges Three RMBS Traders With Defrauding Investors
The Securities and Exchange Commission today announced fraud charges against three traders accused of repeatedly lying to customers relying on them for honest and accurate pricing information about residential mortgage-backed securities (RMBS). The SEC alleges that Ross Shapiro, Michael Gramins, and Tyler Peters defrauded customers to illicitly generate millions of dollars in additional revenue for Nomura Securities International, the New York-based brokerage firm where they worked. They misrepresented the bids and offers being provided to Nomura for RMBS as well as the prices at which Nomura bought and sold RMBS and the spreads the firm earned intermediating RMBS trades. They…
Read MoreSEC Charges Bankrate and Former Executives With Accounting Fraud
The Securities and Exchange Commission today announced that Bankrate Inc. has agreed to pay $15 million to settle accounting fraud charges. Three former executives also are charged in the case that involves fraudulent manipulation of the company’s financial results to meet analyst expectations. The SEC alleges that Bankrate’s then-CFO Edward DiMaria, then-director of accounting Matthew Gamsey, and then-vice president of finance Hyunjin Lerner engaged in a scheme to fabricate revenues and avoid booking certain expenses to meet analyst estimates for a key financial metric: adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). Bankrate consequently overstated its second quarter 2012…
Read MoreSEC Charges Sports Nutrition Company With Failing to Properly Disclose Perks for Executives
The Securities and Exchange Commission today charged a sports supplements and nutrition company with committing a series of accounting and disclosure violations, including the failure to properly report perks provided to its executives as compensation. Denver-based MusclePharm Corporation agreed to settle the charges along with three current or former executives and the company’s former audit committee chair who were found to have been involved in various aspects of the company’s misconduct. An SEC investigation found that MusclePharm omitted or understated nearly a half-million dollars’ worth of perks bestowed upon its executives, including approximately $244,000 paid to CEO Brad Pyatt related…
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