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$750M AOL Settlement In The Works

Time Warner is close to a $750 million settlement with the Securities and Exchange Commission over alleged accounting irregularities at the media giant's America Online unit, the Washington Post reports.

The proposed settlement would cover all fines, penalties and other payments from Time Warner necessary to resolve the matter fully with the SEC and the Justice Department. Earlier this month, Time Warner set aside $500 million to cover the cost of a settlement.

The Post, citing unidentified sources, said Time Warner chairman and chief executive officer Richard Parsons had become personally involved in the settlement talks, and wants to wrap the matter up as soon as possible.

AOL is suspected of cooking its books to inflate revenue and profit figures following its $112 billion merger with the media giant in 2001.

AOL quickly became a burden and an embarrassment to Time Warner. The media giant was seriously damaged by what proved to be grossly overvalued stock and a huge debt at AOL.

Acknowledging the failures of the largest merger in U.S. history, the board of AOL Time Warner Inc. voted last year to remove "AOL" from the company's name.

Time Warner is comprised of dozens of companies: Warner Brothers, New Line Cinemas, Turner Broadcasting (including CNN and TNT), HBO, Warner Music, Time Warner Cable, several local cable companies, AOL, and dozens of magazines, including Time, People, Sports Illustrated and Entertainment Weekly.