Weatherford Charged $140 Million For Accounting Malpractices
Zacks Investment Research | Sep 29, 2016 09:40PM ET
According to the U.S. Securities and Exchange Commission (SEC), Weatherford International Ltd. (NYSE:WFT) has agreed to pay $140 million to settle charges brought against it for overstating earnings by over $900 million. The company had also used misleading income tax accounting practices to justify the incorrect earnings figures.
The SEC also mentioned that two former Weatherford senior accounting executives – James Hudgins and Darryl Kitay – agreed to settle charges that they were the masterminds behind the scheme. Hudgins, who was the vice president of tax, is liable to pay a fine of $334,067 on grounds of disgorgement, interest and penalty. Kitay, who was a tax manager, has been charged a penalty of $30,000.
Weatherford’s CEO, Bernard Duroc-Danner, has also agreed to pay $140 million to settle charges brought against the company.
Per the SEC release, Weatherford, Hudgins and Kitay neither confessed nor contradicted the verdicts. Investigation by SEC is expected to continue.
Hudgins has also been prohibited from serving as an officer or director of a public company for five years. Both Hudgins and Kitay have been debarred from appearing and practicing before the SEC as accountants. Nonetheless, these Weatherford executives can apply for reinstatement after five years.
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