Billionaire tycoon Ricardo Salinas Pliego and the Securities and Exchange Commission reached a settlement last week, marking the end of the first lawsuit against a foreign company under the corporate governance rules of the Sarbanes-Oxley Act.
Salinas Pliego owns Mexico's second-largest broadcast station, TV Azteca and agreed to pay $7.5 million in penalties and compensation to settle accusations of fraud involving a plan to conceal a deal between a TV Azteca subsidiary and a cellphone company secretly owned by Salinas Pliego. He neither admitted, nor denied wrongdoing, and another associate, Pedro Padilla Longoria, agreed to pay $1 million in penalties.
Salinas Pliego has said that the deal saved the phone company from bankruptcy -- and while he and his partner split more than $200 in profits from the discounted debt deal -- the Azteca subsidiary was later paid back in full.
Both Salinas Pliego and Padilla will not be allowed to serve as executives or directors of any publicly-listed American company. Salinas Pliego had already delisted his companies from the New York Stock Exchange, citing the burden of "excessive regulation."
Salinas Pliego did not reveal his involvement in the deal to his board and to regulators until TV Azteca's lawyer in New York resigned at the end for 2003. That led to investigations by the SEC and the National Banking and Securities Commission of Mexico.
Salinas Pliego has already paid more than $2 million in fines to Mexican regulators.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access