SEC Fines Weatherford Int'l $140 Million For Allegedly Inflating Earnings

By Markets MarketWatch Pulse

The Securities and Exchange Commission settled charges Tuesday with Weatherford International , an oil services company, for allegedly inflating earnings by using deceptive income tax accounting. Two of the company's former senior accounting executives allegedly made inappropriate adjustments to fill gaps and meet goals for the company's effective tax rate that were touted to analysts and investors. Weatherford restated its financial statements on three occasions in 2011 and 2012 to correct the misstatements. The company agreed to pay a penalty of $140 million but did not admit or deny the findings. James Hudgins, who served as Weatherford's vice president of tax, and Darryl Kitay, who was a tax manager, will pay penalties of $334,067 and $30,000, respectively. Hudgins is barred from serving as an officer or director of a public company for five years, and Hudgins and Kitay are suspended from appearing and practicing before the SEC as accountants.

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