U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16948 / March 30, 2001
Accounting and Auditing Enforcement Release No. 1380 / March 30, 2001
SECURITIES AND EXCHANGE COMMISSION v. MONTEDISON, S.p.A., Civil Action
No. 1 96CV02631 (RWR) (D. D.C.)
Montedison, S.p.A., an Italian company whose senior management at the
time fraudulently overstated company income by at least $398 million
through early 1993, was ordered by the U.S. District Court for the
District of Columbia to pay a civil penalty of $300,000 for violating
the antifraud, financial reporting and books and records provisions of
the U.S. federal securities laws. The order was the result of a
settlement between the Commission and Montedison in which Montedison
neither admitted nor denied liability for the allegations in the
complaint. The Commission filed the complaint in 1996.
The Commission complaint alleged that Montedison disguised hundreds of
millions of dollars in payments that, among other things, were used to
bribe politicians in Italy and other persons. The fraudulent conduct
was disclosed only after new management was appointed when Montedison
disclosed it was unable to service its bank debt. Virtually all of the
former senior management at Montedison responsible for the fraud were
convicted by Italian criminal authorities and were sued by the
company.
Montedison, which was an Italian corporation with headquarters in
Milan, had interests in the agro-industry, chemicals, energy and
engineering sectors. Until late 2000, American Depositary Receipts
("ADRs") were listed on the New York Stock Exchange. Montedison was
required to file reports with the Commission pursuant to Section 13(a)
of the Exchange Act, including annual reports on Form 20-F.
Montedison was acquired by Compart, S.p.A., in late 2000 and its ADRs
were delisted. Compart then changed its name to Montedison. No
securities of Compart are listed for sale by U.S. stock exchanges.
Compart, which agreed to the settlement on behalf of the former
Montedison, was not a defendant in the Commission's complaint.
In its complaint, the Commission alleged that Montedison violated
Exchange Act sections 10(b), 13(a), 13(b)(2)(A) and 13(b)(2)(B) and
Rules 10b-5, 12b-20 and 13a-1 thereunder. See also Litigation Release
No. 15164, Accounting and Auditing Enforcement Release No. 859 (Nov.
21, 1996).
SNIPPETS:
U.S. SECURITIES AND EXCHANGE COMMISSION
Montedison, S.p.A., an Italian company whose senior management at the time fraudulently
The order was the result of a settlement between the Commission and Montedison in which
The fraudulent conduct was disclosed only after new management was appointed when Montedison
Virtually all of the former senior management at Montedison responsible for the fraud were
Montedison, which was an Italian corporation with headquarters in Milan, had interests in the
American Depositary Receipts were listed on the New York Stock Exchange.
Montedison was required to file reports with the Commission pursuant to Section 13of the
Montedison was acquired by Compart, S.p.A., in late 2000 and its ADRs were delisted.
No securities of Compart are listed for sale by U.S. stock exchanges.
Compart, which agreed to the settlement on behalf of the former Montedison, was not a
In its complaint, the Commission alleged that Montedison violated Exchange Act sections 10,
See also Litigation Release No. 15164, Accounting and Auditing Enforcement Release No. 859.
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