Newell Brands and Former CEO Face SEC Charges for Misleading Investors
SEC charges Newell Brands and ex-CEO for misleading investors about sales. The settlement includes penalties. Get the details on the case.
The U.S. Securities and Exchange Commission (SEC) has filed charges against Newell Brands and its former Chief Executive, Michael Polk, for providing misleading information to investors regarding sales figures.
As part of a settlement, both Newell and Polk, while not admitting to the SEC's findings, have agreed to pay civil penalties. Newell will pay $12.5 million, while Polk will pay $110,000, according to an official statement by the SEC.
The SEC alleges that Newell, a consumer products company based in Georgia, and Polk, implemented measures that artificially boosted the company's reported core sales growth. These practices were not consistent with the actual undisclosed sales trends, enabling Newell to announce robust results in quarters marked by internal disappointment due to sales shortfalls.
Furthermore, Newell allegedly advanced sales from later quarters without providing sufficient disclosure. The company also employed accounting methods that deviated from Generally Accepted Accounting Principles, as stated in the SEC order.
These actions created a false impression of the company's core sales growth aligning with its targets, ultimately depriving investors of an accurate depiction of Newell's genuine sales trends.