The Securities and Exchange Commission charged former Hertz Chairman and CEO Mark Frissora for allegedly aiding and abetting the bankrupt company’s financial reporting and disclosure failures.
In the complaint, the SEC alleged that Frissora committed his wrongdoing in 2013 when Hertz was facing financial and operational challenges. At the time, he was the Chairman and CEO of the company.
Allegations against Frissora
Frissora allegedly pressured his subordinates to “find money” to close the quarterly gaps between Hertz’budget forecasts and actual financial results. His subordinates re-analyzed the company’s reserved accounts totaling over $1 billion and made accounting changes. As a result, the company’s financial reports became inaccurate.
The SEC also alleged that Frissora led Herts to extend the planned holding periods for its rental cars before replacing them. The decision allowed the company to lower its depreciation expenses in the short-term. However, he did not properly disclose the company’s decision to investors.
