McAfee Inc., a manufacturer of computer security software, agreed to pay a $50 million civil penalty to settle securities fraud charges brought by the Securities and Exchange Commission.
McAfee, formerly Network Associates Inc., neither admitted nor denied the allegations brought by the SEC. The agency had alleged that between 1998 and 2000, McAfee misled investors by overstating its revenue and earnings by hundreds of millions of dollars. According to the SEC, for 1998 alone, McAfee overstated revenues by $562 million, and when the company announced in December 2000 that it would miss its quarterly revenue projection by $190 million, the news slashed over $1 billion from McAfee's market capitalization.
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