Dell submits $100 million settlement proposal to SEC on fraud charges
Computer company Dell today issued a statement announcing that it has proposed settlements to the U.S. Securities and Exchange Commission "on terms consistent with the settlement framework described in the company's quarterly report on Form 10-Q for its fiscal quarter ended April 30, 2010."
The company has been under investigation by the SEC for nearly five years for suspicion of negligence, fraud, and misconduct in the company's deals with Intel Corporation.
Dell's 10-Q document (.pdf here) was filed in late June. It says:
"This settlement would involve a civil injunctive action against the company for alleged violations of certain federal securities laws, including the antifraud provisions of the federal securities laws, relating to certain accounting and financial reporting matters. The settlement would also include non-scienter (negligence) based fraud charges, as well as other non-fraud based charges, relating to the company's disclosures and alleged omissions prior to fiscal 2008 regarding certain aspects of its commercial relationship with Intel Corp. Dell has recorded a liability as of April 30, 2010 for a potential settlement of $100 million covering these matters...With respect to Mr. Dell, the remedies under such a settlement would include injunctive and monetary relief, but would not include any bar against his service as an officer and director of a public company."Advertisement
Dell did not say when the settlement might happen, and could not commit to any financial terms and conditions of the settlement. These issues must first be approved by the SEC and then a U.S. District Court.
The SEC probe forced Dell to fix its books, and in 2007 the company admitted its accounting practices back to 2003 were incorrect. Two months after the admission, Dell announced that it had found it was worth some $92 million dollars less than it had originally reported.