AT&T has agreed to pay a $6.25 million penalty to settle a lawsuit by the US Securities and Exchange Commission, which accused the telecoms company of selectively leaking financial information to Wall Street analysts.
Three executives of the company: Christopher Womack, Kent Evans and Michael Black, who the SEC alleged were involved in breaching Regulation FD, or fair disclosure, also agreed to each pay a $25,000 penalty without admitting or denying the regulator's allegations, the SEC said in a court filing.
In a March 2021 lawsuit, the SEC accused Dallas-based AT&T and three investor relations executives of leaking details about its smartphone business to 20 firms.
The SEC said it breached fair disclosure rules, which it adopted in 2000 to bar companies from revealing material non-public information privately. The rules are aimed at helping to level the playing field for investors.
AT&T's goal, alleged the SEC, was to "manage" those analysts and have them lower their revenue forecasts, so that actual results would meet the reduced forecasts and not disappoint investors who might otherwise drive its share price down.