Sallie Mae Averts SECSanctions
RESTON, Va. - (07/27/05) -- Student loan giant Sallie Mae saidit fired the chief financial officer of one of its collectionsubsidiaries, demoted another manager in the unit, and deniedbonuses to the subsidiary's top managers for inflating revenue inan effort to reach performance goals for bonuses, in order toresolve an inquiry by the Securities and Exchange Commission. As aresult, the company said the SEC has agreed not to press for anyenforcement action. Sallie Mae, formally known as SLM Corp., saidinternal investigations discovered that on three occasions in 2003the senior managers of the unidentified subsidiary intentionallyrecorded revenue associated with loan payments made or scheduled tobe made in the first few days of a month in the prior month. SallieMae said the amounts were immaterial, less than $75,000, but thepractices were inconsistent with company policies and violatedgenerally accepted accounting principles (GAAP).