Penthouse International Inc. settled charges of accounting fraud and financial reporting violations with the U.S. Securities and Exchange Commission (SEC) on Thursday.
The settlement resolves the SEC claim that Penthouse used an unauthorized electronic signature of former chief executive officer Bob Guccione to meet law certification requirements in 2003. The SEC accused former Penthouse executive Charles Samel and former shareholder Jason Galanis of preparing and filing the misleading report, knowing Guccione had not seen or approved it.
Reuters reported that the company, Samael and Galanis have not admitted or denied any wrongdoing to the SEC. Samael and Galanis each agreed to pay a $60,000 penalty to settle the charges.
Other charges included improperly booking a $1 million upfront payment as revenue in connection with a 5-year Web site management agreement, as well as changing a quarterly loss of $167,000 to a net profit of $828,000.
Penthouse International formerly published Guccione's influential magazine of the same name, which is now published by Penthouse Media Group.
