Bankrate Inc, an online publisher of widely-read consumer finance data, has agreed to pay a $15 million fine to settle federal regulators' charges of manipulating its financial results to meet analysts' expectations.
The Securities and Exchange Commission today announced the settlement of civil charges of accounting fraud with Bankrate and a former vice president of finance.
Bankrate, based in North Palm Beach, Florida, neither admitted nor denied wrongdoing. It has agreed to refrain from future violations of the securities laws.
The former vice president, Hyunjin Lerner, agreed to resolve allegations that he and two other Bankrate executives ran a scheme to inflate revenues and omit some expenses from reports to meet analysts' estimates for the second quarter of 2012.
Lerner is paying a USD 150,000 fine and making restitution of USD 30,045 that he allegedly gained from selling Bankrate stock after the company announced the false results and the share price rose from USD 15.95 to USD 17.57.
Lerner also was barred for five years from serving as an officer or director of any public company, and for at least five years from working as an accountant for one. The SEC is continuing the case against the two others who are contesting the charges, former chief financial officer Edward DiMaria and ex-accounting director Matthew Gamsey.
"We allege that at the highest levels of its accounting department, Bankrate improperly inflated its financial performance to avoid falling short of Wall Street's expectations," SEC Enforcement Director Andrew Ceresney said in a statement.
The company is best known for its Bankrate.Com website, which lists current data on interest rates, credit cards, insurance, mortgages, auto loans and other areas. Bankrate also licenses content to news organizations including The Wall Street Journal, The New York Times and USA Today.
Bankrate said in a statement that it restated its earnings to resolve the allegedly false accounting. The company also said it previously set aside USD 15 million to cover the settlement amount.
