South African regulator fines Steinhoff for misleading markets
South Africa's market regulator has fined retailer Steinhoff a record R53-million for making "false, misleading or deceptive statements" to the market, the company said on Thursday.
Steinhoff disclosed the hole in its accounts in December 2017 which shocked investors and wiped more than R200-billion off its stock market value.
The company said the penalty would have been R1.5-billion, but was reduced in recognition of the fact that the fraud was perpetrated by former employees and that the company had cooperated with regulators.
"Even after this reduction it remains the largest single fine ever imposed by the FSCA,” Steinhoff said in a statement, quoting the regulator.
The Financial Sector Conduct Authority (FSCA) ruled that multiple, significant restatements of the company's accounts after December 2017 supported the conclusion that Steinhoff failed to meet its obligations under the Financial Markets Act.
Steinhoff CEO Louis du Preez said there were no more further FSCA enforcement actions outstanding against the Steinhoff.
"We are pleased that the matter has now been brought to a conclusion and that the FSCA has recognised our full cooperation with the investigation," said Du Preez.
An independent report by PwC released in March found Steinhoff had overstated profits over several years in a $7.4-billion accounting fraud involving a small group of top executives and outsiders.
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