SEC charges ProPetro and former CEO with failing to disclose executive perks and stock pledges
The SEC’s order finds that Redman caused ProPetro to incur $380,594 worth of personal and travel expenses unrelated to the performance of his duties as CEO. He also failed to disclose to company personnel that he had pledged all of his ProPetro stock in two private real estate transactions.
During the same period, ProPetro failed to properly disclose $47,591 in additional, authorized perks it paid to Redman. As a result of these failures, the company issued public filings that included material misstatements regarding executive perks and stock ownership, and failed to accurately record Redman’s perks in its books and records.
The SEC’s order finds that ProPetro violated reporting, books and records, internal accounting controls, and proxy provisions of the federal securities laws, and that Redman violated proxy provisions and negligence based antifraud provisions.
Redman also caused ProPetro’s reporting and books and records violations. Without admitting or denying the SEC’s findings, ProPetro and Redman agreed to cease and desist from further violations, and Redman agreed to pay a $195,046 penalty.
The order notes ProPetro’s significant cooperation with the agency’s investigation as well as its extensive remedial efforts, which included hiring an entirely new management team with significant public company experience, hiring additional finance department personnel, installing several new directors, and developing new controls, policies, and procedures concerning perks. ■