BorgWarner Inc. (NYSE: BWA) agreed to pay a penalty of $950,000 to settle the charges filed by the Securities and Exchange Commission (SEC), alleging that the company misstated its financial statements.
BorgWarner is a motor vehicle parts m
SEC found that BorgWarner failed to report certain asbestos liabilities
The SEC investigated the financial statements submitted by BorgWarner and found that the company failed to report more than $700 million in liabilities associated with future asbestos claims. Its failure occurred from 2012 to 2016.
The Commission also found that BorgWarner did not perform any substantive quantitative analysis, actuarial assessment, or other testing to estimate the asbestos claims despite having historical raw claims data for almost 40 years.
Additionally, the SEC found that the company mistakenly depended on an unproven assumption in concluding that it cannot reasonably estimate its liabilities associated with the asbestos claims.
