NEWS25 September 2019

Comscore settles fraud charge for $5m

Financials News North America

US – The Securities and Exchange Commission (SEC) has charged measurement firm Comscore and its former chief executive Serge Matta with accounting and disclosure fraud.

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Following an investigation, the SEC said Comscore overstated its revenue by around $50m and made misleading statements about its performance between 2014 and 2016.

Comscore has finalised a settlement of $5m to resolve the matter, but said in a statement it ‘neither admits nor denies the Commission’s allegations’.

The SEC said the company ‘entered into non-monetary transactions for the purpose of improperly increasing its reported revenue’ between February 2014 and February 2016, and made ‘false and misleading public disclosures’ about the customer base and product. This gave the impression that growth was increasing.

All senior management and directors at Comscore at the time are no longer with the company.

Melissa Hodgman, associate director in the SEC’s enforcement division, said: "As the SEC orders find, Comscore and its former CEO manipulated the accounting for non-monetary and other transactions in an effort to chase revenue targets and deceive investors about the performance of Comscore’s business."

Matta, who left the company in 2016, has agreed to pay SEC a penalty of $700,000. As part of his settlement, Matta will also reimburse Comscore $2.1m.

Brent Rosenthal, chairman of the board of Comscore, said: "We are pleased to have settled this legacy issue with the SEC. In addition to our commitment to compliance and with this matter behind us, the board and I remain fully focused on the business and are committed to further developing our unique data assets, differentiated data analytics, and strong brand equity."