Federal securities regulators are accusing Comscore and its ex-CEO of deceiving investors about the company's performance.
The Securities and Exchange Commission on Tuesday alleged that the publicly traded data analytics firm and its former chief executive, Serge Matta, overstated revenue by about $50 million and made false and misleading statements about key performance metrics from February 2014 through February 2016. The scheme allowed Comscore to artificially exceed its revenue targets for seven consecutive quarters, the agency said.
"Comscore and its former CEO manipulated the accounting for non-monetary and other transactions in an effort to chase revenue targets and deceive investors about the performance of Comscore's business," Melissa Hodgman, an associate director in the SEC's enforcement division, said in a news release.
Without admitting or denying the SEC's findings, Comscore and Matta agreed to pay penalties of $5 million and $700,000, respectively, to settle the charges. Matta also agreed to reimburse Comscore $2.1 million from the sale of company stock and incentive-based compensation. He's also barred from serving as an officer or director of a public company for 10 years.
"The conduct occurred under prior management, including Serge Matta," Comscore said in a statement announcing the settlement. "All senior management and directors who were with the company at the time of the conduct described in the order are no longer with the company," it added.
The probe into its accounting practices has been among a handful of ills plaguing the company. Comscore in May shed 10% of its workforce, or about 180 people, in a move to cut costs. It's also had a steady stream of executive departures. The money-losing company's stock price, which fell nearly 5% to close at $2.24, has tumbled 83% this year amid stagnant revenue growth.
Matta became CEO of Comscore in 2014 after 14 years at the company, which keeps tabs on online viewership and how Hollywood films fare at the box office. He left in 2016 and in August was named president and CEO of video analytics company ICX Media.
ICX did not immediately return a request for comment.