The Greenbrier Companies Inc., a freight transportation supply company based in Oregon, and its founder and former CEO and Chairman, William A. Furman, have reached a settlement with the Securities and Exchange Commission over allegations that they failed to disclose perks provided to Furman and other Greenbrier executives, as well as compensation Furman received from Greenbrier’s charters of Furman’s private plane for travel by company executives, including Furman.
SEC Slams Greenbrier and Former CEO Furman
The SEC made the announcement today. Greenbrier and Furman both agreed to pay civil penalties totaling one million dollars and one hundred thousand dollars, respectively, to settle the charges.
According to the orders issued by the SEC, Furman was the owner of a private aircraft, which he leased out to a management company so that the company could charter it to other people on his behalf. According to the orders, during the fiscal years 2017 to 2021, Greenbrier paid approximately $3 million to the management company in order to charter Furman’s plane for business-related travel.
However, Greenbrier did not disclose that Furman received approximately $1.6 million of that amount. According to the orders issued by the SEC, Greenbrier also failed to disclose approximately $320,000 in perks that were provided to Furman and Greenbrier’s other executives from the fiscal years 2017 to 2020. The majority of these perks were for travel-related expenses for the executives’ spouses to attend customer and industry receptions as well as other functions.
“Public companies are required to disclose their executives’ financial interest in the transactions of the companies and to accurately record executives’ perks so that shareholders can fairly evaluate the compensation paid to those executives,” said Monique C. Winkler, Director of the SEC’s San Francisco Regional Office.
“Public companies are also required to disclose their executives’ financial interest in the companies’ transactions,” said Monique C. Winkler. When companies fail to meet their obligations to shareholders, the SEC will hold them accountable, and this will help ensure that our markets continue to be open and fair for everyone,” says the SEC.
The orders issued by the SEC find that Greenbrier and Furman violated provisions of the federal securities laws pertaining to negligence-based antifraud and proxy provisions. The orders also find that Greenbrier and Furman committed or caused violations of the federal securities laws pertaining to reporting, books and records, and internal accounting controls.
In addition to paying fines, the SEC required Greenbrier and Furman to make an agreement to stop and reverse any future violations of the securities laws. Neither company admitted nor denied the findings of the SEC.
Theis Finlev and Brian Huchro, both of the San Francisco Regional Office of the SEC, were the ones in charge of conducting the investigation, and Ms. Winkler and Jason H. Lee were the ones in charge of supervising it.
To read more posts by NfoNews, click here.
