WASHINGTON (NewsNation Now) — The Securities and Exchange Commission announced they were charging AT&T Inc., along with three of its executives, with selectively disclosing material nonpublic information to research analysts.
The complaint dates back to a 2016 incident where AT&T attempted to cover up smartphone sale losses that would cause revenue to fall short of analysts’ estimates for the third consecutive quarter.
The SEC complaint alleges that AT&T Investor Relations executives Christopher Womack, Michael Black, and Kent Evans made private calls with 20 separate firms and released AT&T’s internal smartphone sales data and the impact of that data on internal revenue metrics.
These calls allegedly caused analysts to substantially reduced their revenue forecasts. When AT&T reported their revenue on April 26, 2016, the overall consensus estimate was just below what AT&T actually reported.
The documents AT&T executives allegedly used to persuade analysts were the type of information generally considered nonpublic information reserved for AT&T investors and prohibited from selective disclosure under Regulation FD.
At the time of the incident in early March 2016, AT&T reportedly expected their consolidated gross revenue to be more than a $1 billion below the consensus estimates.
The SEC is seeking monetary damages from AT&T and the three executives named in the complaint.
Read the full SEC complaint below