updated 11:00 am EDT, Fri July 16, 2010
Dell, CEO propose settlements to end SEC probe
PC maker Dell on Friday announced that the company and chairman and CEO, Michael Dell, have proposed settlements to the staff of the US Securities and Exchange Commission (SEC) over claims of illegal accounting practices. These settlements, which weren't detailed, are subject to approval by the SEC and a US District Court. This follows a June announcement that Dell has put aside $100 million to cover the cost of settling the SEC charges.
The original case and investigation dates back to 2006, when Dell employees misled auditors and manipulated results to meet performance targets. In 2007, the company restated four years of earnings after its own audit, reducing its net income by between $50 and $150 million in the process.
Previously, Dell hinted that the settlement of the case is likely to involve a civil injunctive action for alleged violation of certain federal securities laws. It would also include negligence-based fraud charges and other non-fraud based charges related to the company’s accounting reports and its relationship with Intel.