Wednesday, July 18, 2007
On July 18, 2007, the SEC filed civil fraud charges against James Materna, the former chief financial officer of OM Group, John Holtzhauser, the former controller of OM Group, and Paul Venesky, the former controller of OMG Americas, a subsidiary, for accounting fraud. According to the Complaint, the improper accounting practices were done with the intent to manage earnings and resulted in the filing of materially false and misleading financial statements. In March 2005, after conducting an internal investigation, OM Group issued a restatement reducing its retained earnings for the relevant period by $64 million as a result of the fraud. On July 18, 2007, the Commission issued a settled cease-and-desist order that finds that OM Group violated the antifraud, reporting, books and records, and internal controls provisions.