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CVS Caremark finalizes settlement with SEC
April 8th, 2014
WOONSOCKET, R.I. – CVS Caremark Corp. has closed a previously announced settlement with the Securities and Exchange Commission regarding charges of misleading investors about its PBM business and improper accounting related to its October 2008 acquisition of Longs Drug Stores.
CVS said Tuesday that the settlement, disclosed last August, was entered into on a "no admit or deny basis" and won't require the company to restate earnings for any reporting period.
"This matter is now fully resolved for the company and individuals," CVS stated.
"As previously announced last year when the company disclosed that it had reached an agreement in principle with the staff of the SEC," CVS explained, "the settlement relates to events that occurred in the third and fourth quarters of 2009, including certain public disclosures made by the company and certain aspects of the purchase accounting adjustment related to the October 2008 Longs Drug Stores acquisition."
Under the settlement with the SEC, CVS has agreed to pay a $20 million civil penalty.
In announcing the final settlement on Tuesday, the SEC said it charged CVS with misleading investors in 2009 by omitting key information about the financial status of its pharmacy benefit management (PBM) business and by making an improper accounting adjustment for its acquisition of Longs and then failing to disclose it.
The SEC added that the settlement is subject to court approval.