SEC probe of American Apparel ends without enforcement action
Los Angeles clothier American Apparel Inc. said an investigation by the Securities and Exchange Commission into its financial reporting practices had ended without enforcement action.
The investigation was sparked in 2010 when Deloitte & Touche resigned as American Apparel’s accountant and warned the retailer that its previous audit reports and 2009 financial statements may not be reliable.
The SEC told American Apparel this week that the investigation was ending, and no enforcement action was recommended against the retailer, the company said Wednesday.
Peter Schey, an attorney for American Apparel, said he was “not at all surprised” by the result.
“During the entire investigation with Deloitte, those employed at American Apparel’s financial departments have always acted in a manner fully consistent with applicable laws and regulations, and always conducted themselves in the highest ethnical manner,” Schey said. “There was no wrongdoing in any way, shape or form.”
Judith Burns, an SEC spokeswoman, declined to comment on the investigation.
Shares of American Apparel rose 14 cents, or 15.6%, to $1 on Wednesday.
