A recent announcement by Mannatech Inc. concerning the termination of an SEC investigation against it and certain individuals shows the power of the SEC’s “Wells process.”
On September 5, 2008, Mannatech disclosed in a Form 8-K that the company, its CFO, and the Chairman of its Audit Committee had received “Wells notices” from the Staff of the SEC relating to the timing and completeness of Mannatech’s October 2007 Form 8-K disclosure regarding its dismissal of Grant Thornton LLP as its independent registered public accountants. For those unfamiliar with the term, a Wells notice is not something you want to receive from the SEC. As recently documented by the SEC’s new enforcement manual, the function of a Wells notice is to tell a person involved in an investigation that
