The Securities and Exchange Commission today announced settled charges against Ohio-based Express, Inc., a multi-brand American fashion retailer, for failing to disclose executive compensation it paid to its now former CEO.
According to the SEC’s order, in definitive proxy statements for fiscal years 2019, 2020, and 2021, Express failed to disclose $979,269 worth of perks and personal benefits provided to its CEO, including certain expenses associated with the CEO’s authorized use of chartered aircraft for personal purposes. As a result, the company, which filed for Chapter 11 bankruptcy earlier this year, understated the “All Other Compensation” portion of its CEO’s compensation by an average of 94 percent over the three fiscal years.
“Public companies have a duty to comply with their disclosure obligations regarding executive compensation, including perks and personal benefits, so that investors can make educated investment decisions,” said Sanjay Wadhwa, Acting Director of the SEC’s Division of Enforcement. “Here, although Express fell short in carrying out its obligation, the Commission declined to impose a civil penalty based, in part, on the company’s self-report, cooperation with the staff’s investigation, and remedial efforts.”
The SEC’s order finds that Express violated Sections 13(a) and 14(a) of the Securities Exchange Act of 1934 and Rules 12b-20, 13a-1, 13a-15(a), 14a-3, and 14a-9 thereunder. Without admitting or denying the SEC’s findings, Express agreed to a cease-and-desist order.
The SEC’s investigation was conducted in the Chicago Regional Office by Ruta G. Dudenas and Ann Tushaus, and supervised by Amy S. Cotter.
