The U.S. Securities and Exchange Commission announced settled charges against Vince McMahon, former Executive Chairman and CEO of World Wrestling Entertainment Inc., for signing two settlement agreements in 2019 and 2022 on behalf of himself and WWE without disclosing them to WWE’s board, control functions, or auditor. The SEC found the nondisclosure circumvented WWE’s internal accounting controls and resulted in material misstatements in WWE’s 2018 and 2021 financial statements. Under the SEC’s order, the agreements required McMahon to pay USD 3 million to a former employee and USD 7.5 million to a former independent contractor in exchange for nondisclosure and releases of potential claims against WWE and McMahon; the payments were not recorded and should have been disclosed as related party transactions. The SEC found WWE overstated 2018 net income by about 8% and 2021 net income by about 1.7%, and that McMahon also signed management representation letters to the auditor that omitted the agreements; WWE restated its financial statements in August 2022. Without admitting or denying the findings, McMahon agreed to cease and desist from violating the relevant Exchange Act provisions, pay a USD 400,000 civil penalty, and reimburse WWE USD 1,330,915.90 under Section 304(a) of the Sarbanes-Oxley Act.
U.S. Securities & Exchange Commission 2025-01-10
U.S. Securities and Exchange Commission settles charges against Vince McMahon for withholding WWE settlement agreements that led to misstated earnings
The U.S. Securities and Exchange Commission settled charges against Vince McMahon for nondisclosure of settlement agreements, which circumvented WWE’s internal accounting controls and led to material misstatements in financial statements. McMahon agreed to cease violations, pay a USD 400,000 civil penalty, and reimburse WWE USD 1,330,915.90. WWE restated its financial statements in August 2022 to correct overstated net income from 2018 and 2021.