Exela Technologies, ex-CFO settle SEC control failure charges

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A Texas-based IT firm and its former chief financial officer settled charges brought by the Securities and Exchange Commission (SEC) alleging failure to properly account for and record liabilities related to a shareholder lawsuit.

Exela Technologies and former CFO James Reynolds agreed to pay $175,000 and $10,000, respectively, to settle claims they violated reporting, controls, and recordkeeping provisions of federal securities law, the SEC said Monday.

According to the agency’s order, Exela failed to properly account for and report liabilities when it was sued by minority shareholders who dissented from a 2017 merger. From 2017-19, the company failed to accrue for any payment it would have to make to those shareholders, despite disclosing the shareholders’ claim in SEC filings.

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