Becton, Dickinson And Co. Agrees To Pay $175 Million Civil Penalty
The Securities and Exchange Commission on Monday announced it had settled charges against Becton, Dickinson and Company BDX, known as BD, for repeatedly misleading investors about risks associated with its continued sales of its Alaris infusion pump and for overstating its income by failing to record the costs of fixing multiple software flaws with the pump. BD agreed to pay a $175 million civil penalty.
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"BD repeatedly painted a misleading picture of its Alaris infusion pump for investors and then doubled down by keeping them in the dark when the device's issues came to a head with the FDA in late 2019," said Sanjay Wadhwa, Acting Director of the SEC's Division of Enforcement.
"Public companies have a fundamental duty to accurately disclose material business risks and should expect to be held accountable when they fall short in that regard," Wadhwa added.
The SEC's order finds that BD violated antifraud, reporting, internal accounting controls, books and records and disclosure controls provisions of the federal securities laws. BD agreed to cease and desist from further violations of these provisions, to retain an independent compliance consultant to review and make recommendations concerning its disclosure controls and procedures and to the $175 million civil penalty, without admitting or denying the SEC's findings.
Express Fails To Disclose CEO's Full Executive Compensation
The SEC announced on Tuesday that it has settled charges against fashion retailer Express, Inc. EXPRQ for failing to disclose executive compensation it paid to its now former CEO with Express agreeing to a cease-and-desist order, without admitting or denying the SEC's findings.
According to the SEC's order, Express failed to disclose $979,269 worth of perks and personal benefits provided to its CEO for fiscal years 2019, 2020, and 2021. As a result, Express understated the "All Other Compensation" portion of its CEO's compensation by an average of 94% over the three years. The company filed for Chapter 11 bankruptcy earlier this year.
"Public companies have a duty to comply with their disclosure obligations regarding executive compensation, including perks and personal benefits, so that investors can make educated investment decisions," said Sanjay Wadhwa, Acting Director of the SEC's Division of Enforcement.
"Here, although Express fell short in carrying out its obligation, the Commission declined to impose a civil penalty based, in part, on the company's self-report, cooperation with the staff's investigation, and remedial efforts," Wadhwa added.
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