U.S. SEC sets out settlement with AgFeed over accounting fraud
AgFeed, a Tennessee animal feed company, will pay back $18 million in alleged illicit profits to settle civil accounting fraud charges, U.S. regulators said Monday.
AgFeed Industries, which is currently in bankruptcy, was charged by the Securities and Exchange Commission in March in connection with charges that it reported fake revenue from its China-based operations to help prop up its stock price.
The company was previously based in China before it merged with a U.S. company in 2010 and spread its operations between the two countries.
According to the SEC, AgFeed’s Chinese management kept two sets of books – a real one and a fake one to present to investors.
The case has garnered some attention because the SEC also charged the company’s former U.S.-based independent audit committee chairman, a rare move by the agency.
The settlement announced on Monday is subject to court approval. The company is settling without admitting or denying the charges.
The SEC said the $18 million will be distributed to victims of the fraud.
Source: reuters- AgFeed’s accounting fraud
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