Telecommunications company AT&T settled with the Securities and Exchange Commission for $6.25 million Friday in order to clear up a lawsuit alleging fair disclosure violations.
In a March 2021 suit, AT&T executives were accused of privately and selectively disclosing nonpublic financial information about the company to Wall Street analysts. Calls were made to analysts at around 20 firms, in which sales data was disclosed, the SEC alleged.
The SEC accused AT&T of leaking the data so that analysts would reduce their revenue forecasts, thereby preventing AT&T from later falling short of said forecasts.
The SEC thusly alleged the company violated fair disclosure rules meant to keep all investors on a level playing field.
Three AT&T executives alleged to be involved, Christopher Womack, Kent Evans, and Michael Black, also agreed to pay $25,000 each. Neither AT&T nor the three executives admitted or denied the SEC allegations with these settlements.
“We are committed to following all applicable laws and pleased to have resolution with the SEC. With this settlement, the company and its employees neither admitted nor denied the SEC’s allegations,” AT&T told Reuters.
Watchdog groups applauded the move but also called on the SEC to act more harshly in response to alleged violations.
“Mere money penalties are too light to stop this widespread corporate practice of market manipulation,” Better Markets CEO Dennis Kelleher told Bloomberg.