Georgia homebuilder Beazer Homes USA Inc. is being accused by the U.S. Securities and Exchange Commission (SEC) for falsely reporting on income statements, to give the appearance that they are making more money than they actually are. The former Chief Financial Officer of the company is facing arbitration that will force him to reimburse Beazer Homes for nearly $1.5 million. It is believed that he received those funds after filing the fraudulent reports for the 2006 fiscal year. The business litigation is still pending in Atlanta.
The SEC asserted that the former CFO is not being accused of misconduct and that the former CFO did not confirm or deny any liability. Currently, the official charge against him is a failure to reimburse. A federal justice is required to approve the settlement. The U.S. Securities and Exchange Commission is claiming that while the company was reporting inflated numbers which provided motivation for the ex-CFO to gain higher profits of which he received "incentive compensation."
It does not seem that this is the only challenge faced by executive officers of Beazer Homes. One of Beazer Homes' Chief Accounting Officers, who was employed at the time of the alleged fraudulent reports, was also indicted on obstruction of justice and securities fraud. The former Chief Executive Officer has agreed to return $6.5 million in compensation, but the reimbursement of monies from the former CFO is still pending.
Unfortunately, business litigations are all too common, and are sometimes the result of fraud and tortious interference. No matter what type of commercial litigation you are facing, a solid and experienced attorney may be able to provide you with the understanding and security you need in any financial litigation.
Source: The Bloomberg, "Ex-Beazer Homes Finance Chief James O'Leary Settles SEC Lawsuit Over Bonus," Joel Rosenblatt and Laurence Viele Davidson, Aug. 31, 2011