Former CEO of McDonald`s fined $400,000 for misleading investors
[ad_1]
US Securities and Exchange Commission (SEC) accused former McDonald’s CEO Steven Easterbrook for misleading investors with statements about the reasons for his resignation in November 2019. For this violation, Mr. Easterbrook was fined $400,000 by the regulator. In addition, he will not be able to hold senior positions in public companies for five years.
Stephen Easterbrook was named CEO of McDonald’s in 2015. In 2019, he was fired after it became known that he had an affair with one of the employees, which is a violation of the company’s internal policy. When analyzing this situation, Mr. Easterbrook claimed that he had no other connections within the company. And when discussing the terms of the dismissal, the corporation and Mr. Easterbrook agreed that the agreement on his dismissal would indicate that it was not related to direct dereliction of duty or wrongdoing. Otherwise, the former CEO would then have lost significant compensation.
However, after he left the company, an ongoing internal McDonald`s investigation found that Mr. Easterbrook had other “inappropriate relationships with other employees” of the corporation. The corporation filed a lawsuit against him, accusing him of sexual relations with employees. In December 2021, Mr. Easterbrook returned the compensation received upon dismissal and made an official apology to the corporation.
According to the SEC, Mr. Easterbrook should have known that hiding these facts from the company would have a negative impact on McDonald’s reporting to investors. “When management disrupts internal processes to mend their own reputations or to warm their hands, they are violating their fundamental duty to shareholders, who deserve transparency and fairness from management,” the SEC said in a statement. According to the regulator, hiding the extent of his violations from an internal investigation, Stephen Easterbrook violated the trust and misled shareholders. The regulator also brought charges against the corporation itself in connection with “shortcomings” in disclosing data on the reasons for Easterbrook’s dismissal. However, since the corporation fully cooperated with the regulator’s investigation, it was decided not to impose a fine on it.
[ad_2]
Source link
