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McAfee Settles Fraud Charges |
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Source: Red Herring - Posted by Pax Dickinson
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Security vendor McAfee agreed on Wednesday to pay a $50-million fine to the U.S. Securities and Exchange Commission to settle charges that it overstated its revenue and earnings by hundreds of millions of dollars, closing an unpleasant chapter in the company’s history.
The SEC had charged McAfee with securities fraud for allegedly inflating cumulative net revenue by $622 million during the period between 1998 and 2000. For 1998 alone, McAfee overstated revenues by $562 million, a misstatement of 131 percent, said the SEC.
According to the SEC, the scheme unraveled in December 2000 when McAfee announced it would miss its quarterly revenue projection by $190 million. At the time, the stock declined sharply, wiping out more than $1 billion of its market capitalization.
McAfee consented to pay the multimillion-dollar penalty to the SEC without admitting or denying the allegations of the complaint.
Read this full article at Red Herring
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