BISYS a leading US provider of financial products and support services, has agreed to pay approximately $25m (£12.6m) to resolve a claim brought against it by the Securities and Exchange Commission.
The SEC's case alleged that between July 2000 and December 2003, former BISYS staff 'engaged in a variety of improper accounting practices' which led to an overstatement of the company’s reported financial results by almost $180m.
The practices mainly occurred in the company’s insurance services division, where the SEC believed BISYS had recorded revenue commissions from acquired companies that it had not officially acquired yet as its own. The company was also charged with improperly accounting for renewal and bonus commissions and making other improper accounting entries that overstated revenue or reduced expenses.
Mark K. Schonfeld, director of the SEC's New York office said, 'This is a case study in internal control failures under earnings pressure. The settlement delivers meaningful relief to investors harmed by BISYS’s misconduct.'
In reaching the settlement, BISYS said: 'The company has agreed, without admitting or denying any wrongdoing, to refrain from future violations of the reporting, books and records and internal control provisions of the federal securities laws and related SEC rules'.
Further reading:
SEC holds roundtable with its former chairmen
Comments