Aura Systems Confirms SEC Investigation

Aura Systems Inc. confirmed that the Securities and Exchange Commission is investigating its accounting practices and that it has received a subpoena for company information from the agency. The unprofitable El Segundo-based loudspeaker company said it’s “cooperating fully” and doesn’t think the investigation will have a material effect on its future financial condition. Aura said the inquiry “appears to relate to accounting matters in prior years.” According to a Formal Order of Investigation dated Oct. 30, the SEC has evidence that “tends to show that from on or about Oct. 1, 1996, to the present,” Aura may have defrauded investors by misreporting financial performance, loans to executives and the circumstances surrounding joint ventures. The order authorizes the SEC staff to subpoena witnesses and documents. The company didn’t mention the inquiry in its Form 10-Q filed with the SEC last week. The SEC investigation is the second by the agency of Aura’s bookkeeping. Aura’s stock fell 16 cents to close at 41 cents on Nasdaq, its lowest in at least seven years.