News built for finance pros
CFO Brew helps finance pros navigate their roles with insights into risk management, compliance, and strategy through our newsletter, virtual events, and digital guides.
You know the feeling when you’re making soooooo much money, and you just conveniently forget to tell anyone about it?
It’s kind of like forgetting that you had $5 in your wallet, except not at all. Sure, it’s not the most relatable problem, so you’ll just have to ask the former CEO of Express what it really feels like.
The Securities and Exchange Commission settled charges against fashion retailer Express for failure to disclose aspects of its former CEO’s compensation.
According to the SEC’s order, the company failed to disclose more than $979,000 worth of “perks and personal benefits” it issued to the company’s CEO in “definitive proxy statements for fiscal years 2019, 2020, and 2021.”
That included “certain expenses associated with the CEO’s authorized use of chartered aircraft for personal purposes.” We’ll check how much a private jet trip to a small Caribbean island goes for nowadays, and get back to you on how we’d use chartered aircraft for personal purposes.
It would definitely add up. Over the three fiscal years in question, the company underreported the “All Other Compensation” component of its CEO’s pay by an average of 94%, according to the SEC. Whoops!
The company, which filed for Chapter 11 bankruptcy protection earlier this year, didn’t admit or deny the SEC’s findings, but complied with a cease and desist order.
“Public companies have a duty to comply with their disclosure obligations regarding executive compensation, including perks and personal benefits, so that investors can make educated investment decisions,” Sanjay Wadhwa, acting director of the SEC’s enforcement division, said in a statement. “Here, although Express fell short in carrying out its obligation, the Commission declined to impose a civil penalty based, in part, on the company’s self-report, cooperation with the staff’s investigation, and remedial efforts.”