An Oregon-based freight transportation company and its former chief executive officer will pay a total of $1.1 million to settle charges from the Securities and Exchange Commission (SEC) the firm failed to disclose perks related to the use of a private jet owned by the CEO.
Greenbrier Companies agreed to pay a $1 million fine and cease and desist from future violations of federal securities law as part of its settlement. The company’s co-founder, former CEO, and former executive chairman, William Furman, agreed to pay a $100,000 penalty. Furman will continue to serve on Greenbrier’s board of directors until 2024, the SEC said.
Neither Greenbrier nor Furman admitted or denied the agency’s findings.
By failing to disclose the perks, Greenbrier and Furman “violated negligence-based antifraud and proxy provisions of the federal securities laws” and committed or caused violations of the reporting, books and records, and internal accounting controls of such laws, the SEC said Thursday in a press release.
According to the agency’s order for Greenbrier, Furman owned a private jet that was leased by Greenbrier from 2017-21 for approximately $3 million through an aircraft management company. Greenbrier and Furman allegedly did not properly disclose Furman received about $1.6 million of that amount.
The SEC also found Greenbrier failed to disclose approximately $320,000 in travel perks to Furman and other Greenbrier executives over the same time period, “mostly for travel-related expenses for the executives’ spouses to attend customer and industry receptions as well as other functions,” the agency said in its release.
A spokesperson for Greenbrier said that “concluding these proceedings by mutual agreement is in the best interest of our shareholders” in an emailed statement. The company disclosed the matter in its annual report in October.
“Importantly, there is no allegation of intentional wrongdoing. Because this was a proxy statement disclosure issue, it does not require an amendment of any SEC filings. It also does not require a restatement of our previous financial statements,” the statement said.
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