SEC to dismiss accounting fraud case against bridge builder

The Securities and Exchange Commission will drop a lawsuit against the former vice president of a California construction company that accused him of fraudulent accounting in projects including New York's Kosciuszko Bridge.

Attorneys for Dale Swanberg and the SEC asked a federal judge in the Northern District of California to end the case, according to a filing made public on Thursday. The regulator said its decision was based on "the facts and circumstances of this case and its ongoing review of the evidence, including the narrowed scope of the evidence the SEC intended to present at trial."

The dismissal is "tremendously rewarding, as it proves that Mr. Swanberg's reputation and legacy for honesty is validated," said William Michael Jr., co-chair of Greenberg Traurig's litigation practice, which represented Swanberg.

The SEC in 2022 sued Swanberg, who previously served as a group leader and senior vice president of Granite Construction Inc. The group struggled for years, the SEC said, and Swanberg allegedly sought to improperly defer recording cost increases on his projects. 

Granite settled the SEC's claims by agreeing to pay $12 million but Swanberg fought the allegations.

Hiding the losses led Granite having to formally restate, or redo, several years worth of financial statements, the SEC said at the time. His attorneys in court filings argued Swanberg was a builder, not an accountant, and his compensation wasn't tied to Granite's stock price or its financial reporting.