The Securities and Exchange Commission on Tuesday brought charges against Manitex International and three of its former senior executives for engaging in accounting fraud that resulted in the issuance of materially misstated financial statements.

According to the SEC, Manitex—a manufacturer and distributor of cranes, forklifts, and heavy equipment—improperly accounted for and misled its outside auditor about nonexistent inventory. The agency’s order describes two schemes perpetrated by Andrew Rooke, Manitex’s former chief operating officer, and Stephen Harrison, the former general manager of a Manitex subsidiary.

In the first scheme, beginning around January 2014, Rooke and Harrison “created false inventory lists and shipping documents, which were provided to Manitex’s outside auditor to cover up a $1.39 million inventory shortfall at one of Manitex’s subsidiaries,” according to the SEC’s order. At Rooke’s direction, Manitex purportedly contributed the $1.39 million in non-existent inventory to Lift Ventures, a joint venture Rooke and Manitex created in December 2014, and recorded the non-existent inventory as a non-marketable equity investment. As a result, the SEC found, Manitex materially overstated its 2014 operating income and pre-tax income.

In the second scheme, Manitex improperly recognized revenue and misled its auditor on approximately $12 million in purported “bill and hold” crane sales to a dormant company, the SEC’s order states. As a result, Manitex overstated its 2016 net revenues; subsequently, the firm in 2018 restated financial statements for 2016 and the first two quarters of 2017.

As described in the order, Michael Schneider, Manitex’s former controller and chief financial officer, approved fraudulent invoices as part of the second scheme, despite knowing they weren’t genuine.

According to the SEC, Manitex, Rooke, Schneider, and Harrison violated certain anti-fraud, reporting, books-and-records, and internal accounting controls provisions of the federal securities laws. Without admitting or denying the orders’ findings, they agreed to cease and desist from future violations of the charged provisions.

Manitex, Rooke, and Schneider agreed to pay civil penalties totaling $485,000. Rooke, Schneider and Harrison agreed to bars from serving as officers or directors of public companies, and Rooke and Schneider agreed to suspensions from appearing or practicing before the SEC as accountants.