Google's chief legal officer and VP of corporate development, David Drummond, is to pay the US Securities and Exchange Commission (SEC) close to $700 000 in fines for overstating the revenue of his previous company, where he was chief financial officer.
The SEC says it filed civil actions against Drummond and two financial vice-presidents – Patrick Murphy and John Hayes – for overstating the revenue of software company SmartForce by $113,6-million and its net income by $127-million between 1999 and 2002. It also filed a separate injunctive action against former SmartForce executive Patrick Chew.
The four will pay civil penalties totalling $325 000 regarding these actions, $125 000 of which will be paid by Drummond.
The SEC statement continues: "In the related administrative proceeding, which was instituted against Drummond, Murphy and Hayes, each is required to pay total disgorgement and prejudgment interest as follows: $573 979 for Drummond, $567 866 for Murphy, and $862 395 for Hayes.
"The administrative order further bars Murphy and Hayes from practicing before the Commission as accountants, with the right to apply for reinstatement after two years. The administrative order also requires that Drummond, Murphy, and Hayes cease and desist from committing or causing any violations or future violations of Section 13(b)(5) of the Exchange Act; and from causing any violations and any future violations of Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 12b-20, 13a-1 and 13a-13 thereunder.
"Drummond, Murphy and Hayes neither admitted nor denied the findings in that administrative order," the SEC says.