August 15, 2007 4:16 PM PDT
SEC may file charges against Take-Two
Take-Two, maker of the Grand Theft Auto video games, has been under investigation by the SEC over allegations that the company engaged in improper stock options pricing practices.
Last week, SEC staff members informed Take-Two that it was planning to recommend to the commissioners that charges be filed in the case and that monetary damages should be sought. The SEC then provided Take-Two with a "Wells" notice, which allows the company to issue comments and materials that state its position before SEC commissioners make a decision on whether to levy charges or fines.
"The company continues to cooperate with the staff and continues to expect to resolve this investigation by means of a settlement rather than a contested litigation of charges, and believes that the "Wells" call represents a significant step forward towards that resolution," Take-Two stated in its SEC filing.
The SEC's "Wells" notice follows guilty pleas last month from Take-Two's former general counsel Kenneth Selterman and former accounting chief Patti Tay. Both pleaded guilty to single misdemeanor counts before the New York State Supreme Court.