The oil and natural gas services company Weatherford International will pay a $140 million penalty to settle accounting fraud charges.

The Securities and Exchange Commission said Tuesday the company agreed to pay $140 million to settle charges it inflated its earnings through deceptive tax accounting. Two former senior accounting executives at Weatherford have also agreed to settle the SEC’s charges.

The SEC said Weatherford fraudulently lowered its year-end provision for income taxes by $100 million to $154 million every year between 2007 and 2012 to align its earnings with the company’s original projections and analyst expectations. 

James Hudgins, Weatherford’s then-vice president of tax, and Darryl Kitay, who was a tax manager during that period, made post-closing adjustments to fill gaps and meet the company’s previously disclosed effective tax rate. Weatherford regularly promoted its favorable ETR to analysts and investors as one of its main competitive advantages, so its tax structure could appear to be much more successful than it really was. Weatherford eventually needed to restate its financial statements three times in 2011 and 2012. The company was audited by Ernst & Young.

“Weatherford denied its investors accurate and reliable financial reporting by allowing two executives to choose their own numbers when the actual financial results fell short of what was previously disclosed to analysts and the public,” SEC enforcement director Andrew Ceresney said in a statement. “This case is part of our continued focus on financial reporting and disclosure fraud.”

Hudgins, Kitay and the company agreed to the SEC’s order without admitting or denying the charges. The company will pay a $140 million penalty. Hudgins will pay $334,067 in disgorgement, interest and penalties, while Kitay will pay a $30,000 penalty. Hudgins has also been barred from serving as an officer or director of a public company for five years. Both he and Kitay have been suspended from appearing and practicing before the SEC as accountants, although they can apply for reinstatement after five years. The SEC said its investigation is continuing.  

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