eFunds Settles SEC Charges

Register now

SCOTTSDALE, Ariz. - (11/22/04) -- The Securities and ExchangeCommission said Friday it had issued civil administrative chargesagainst eFunds Corp., charging the payments processor improperlyrecorded $2.1 million in revenues in 2001 which helped the companymeet analysts' expectations for the second quarter of 2001. As aresult, three former eFunds executives agreed to pay more than$200,000 in restitution and other penalties to settle charges thatthey had allowed the company to book the improper revenue. Thecompany was not fined because it promptly took remedial steps andcooperated with the SEC, the securities regulator said. PaulBristow, the former chief financial officer; Nikhil Sinha, a formerexecutive vice president; and Jerry Lester, a former president, allagreed to settle the administrative charges without admitting ordenying wrongdoing. The SEC said that in the 2001 second quarter,eFunds improperly recognized $2.1 million in revenue from asettlement payment by an affiliate. Officials said the revenue wasimproper because eFunds later agreed to reimburse the affiliate bypaying the same amount in consulting fees.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER