{"id":2137,"date":"2022-02-24T11:21:44","date_gmt":"2022-02-24T16:21:44","guid":{"rendered":"https:\/\/seci.wpenginepowered.com\/?p=2137"},"modified":"2022-02-24T11:21:44","modified_gmt":"2022-02-24T16:21:44","slug":"headspin-enforcement-avoiding-penalties","status":"publish","type":"post","link":"https:\/\/seciblog.pli.edu\/index.php\/headspin-enforcement-avoiding-penalties\/","title":{"rendered":"HeadSpin Enforcement \u2013 Avoiding Penalties"},"content":{"rendered":"<p>On August 25, 2021, the SEC announced charges against the former CEO of HeadSpin, Inc.\u00a0 HeadSpin is a private tech company in Silicon Valley.\u00a0 According to the <a href=\"https:\/\/www.sec.gov\/news\/press-release\/2021-164\">Press Release<\/a> and related <a href=\"https:\/\/www.sec.gov\/litigation\/complaints\/2021\/comp-pr2021-164.pdf\">SEC Complaint<\/a>, the former CEO falsely manipulated sales records and key performance metrics.\u00a0 The SEC alleges that the former CEO exerted control over HeadSpin\u2019s financial reporting and was able to misstate results with actions such as creating false invoices and altering real invoices.<\/p>\n<p>In this type of announcement the SEC almost always includes language that their investigation \u201cis continuing.\u201d\u00a0 Usually further cases follow against the company and other parties.\u00a0 The SEC did enforce against HeadSpin, but, surprisingly, the enforcement action did not assess penalties against the company.\u00a0 As outlined in the SEC\u2019s January 28, 2022, \u00a0<a href=\"https:\/\/www.sec.gov\/news\/press-release\/2022-14\">Press Release<\/a> and <a href=\"https:\/\/www.sec.gov\/litigation\/complaints\/2022\/comp-pr2022-14.pdf\">Complaint<\/a>, it was an internal investigation started by the company\u2019s Board of Directors that discovered the CEO\u2019s actions.\u00a0 Additionally, the company took significant remedial steps including removal of the CEO, hiring new senior management and repaying investors.\u00a0 Based on these steps and others outlined in the <a href=\"https:\/\/www.sec.gov\/litigation\/complaints\/2022\/comp-pr2022-14.pdf\">Complaint<\/a>, \u00a0the SEC settled fraud charges against the company without any penalty.<\/p>\n<p>Both the <a href=\"https:\/\/www.sec.gov\/news\/press-release\/2022-14\">Press Release<\/a> and <a href=\"https:\/\/www.sec.gov\/litigation\/complaints\/2022\/comp-pr2022-14.pdf\">SEC Complaint<\/a> offer valuable insights about steps companies can take when such a problem is discovered.<\/p>\n<p>As always, your thoughts and comments are welcome!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On August 25, 2021, the SEC announced charges against the former CEO of HeadSpin, Inc.\u00a0 HeadSpin is a private tech company in Silicon Valley.\u00a0 According to the Press Release and related SEC Complaint, the former CEO falsely manipulated sales records and key performance metrics.\u00a0 The SEC alleges that the former CEO exerted control over HeadSpin\u2019s &hellip; <a href=\"https:\/\/seciblog.pli.edu\/index.php\/headspin-enforcement-avoiding-penalties\/\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">HeadSpin Enforcement \u2013 Avoiding Penalties<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":false},"categories":[242],"tags":[],"coauthors":[154],"class_list":["post-2137","post","type-post","status-publish","format-standard","hentry","category-reporting"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/2137","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/comments?post=2137"}],"version-history":[{"count":0,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/2137\/revisions"}],"wp:attachment":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/media?parent=2137"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/categories?post=2137"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/tags?post=2137"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/coauthors?post=2137"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}