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Updates to add Skechers statement
The U.S. Securities and Exchange Commission (SEC) on Thursday said that footwear maker Skechers U.S.A. (NYSE:SKX) had agreed to pay a $1.25M penalty to settle charges over undisclosed payments to family members of its executives.
The company was also charged with failing to disclose outstanding loans to its executives.
“We are pleased that the Securities and Exchange Commission recognized our cooperation and remedial efforts, and we were able to come to an amicable resolution. This outcome is consistent with the results of our previously announced internal review and the corrective disclosures made over the course of last year,” a Skechers (SKX) spokesperson told Seeking Alpha in an emailed statement.
As per the SEC’s order, from 2019 through 2022, Skechers (SKX) did not disclose its employment of two relatives of its executives and did not disclose a consulting relationship involving a person who shared a household with one of its executives.
Additionally, the SEC’s order alleged that for multiple years, Skechers (SKX) failed to disclose that two of its executives owed more than $120K to the company for personal expenses that had been paid for by the firm but not yet reimbursed by the executives.
“Disclosure of related person transactions provides important information for investors to evaluate the overall relationship between a company and its officers and directors. Today’s action is a reminder that companies should take appropriate measures to ensure proper disclosure of such transactions,” Scott Thompson, associate director of enforcement in the SEC’s Philadelphia regional office, said in a statement.
According to the SEC, Skechers (SKX) did not admit or deny the agency’s findings and has agreed to a cease-and-desist order and to pay the $1.25M civil monetary penalty.