US meat processor Tyson Foods has said it has agreed to settle an SEC case against the company regarding the disclosure of payments to executives.
In August 2004, the company announced that the staff of the Securities and Exchange Commission (SEC) intended to recommend a civil enforcement action against the company and that it was considering seeking a monetary penalty. The notice alleged that the company’s proxy statements for the fiscal years from 1997 to 2003 had failed to comply with SEC regulations with respect to the disclosure and description of payments totalling around US$1.7m to Don Tyson, former senior chairman of the company. The notice also alleged that Tyson Foods had failed to maintain an adequate system of internal controls regarding the personal use of company assets and the disclosure of payments and personal benefits.
In addition, Don Tyson received notice the staff intended to recommend that the SEC bring a similar civil enforcement action against him.
Tyson Foods said that it had proposed the company, without admitting or denying wrongdoing, would pay a civil penalty of $1.5m, while Don Tyson, also without admitting or denying wrongdoing, would pay a civil penalty of $200,000.
“These settlement proposals are subject to mutual agreement on the language of the order. The SEC staff has agreed to recommend both of these offers of settlement to the SEC. The proposed settlements and the proposed order are subject to final approval by the SEC,” Tyson said.