ArthroCare Corp. (NSDQ:ARTC) escaped a Securities & Exchange Commission probe into its finances after a fraud scandal that took down a former CEO with no admission of guilt, no financial penalty and a promise to be good from now on.
The Austin, Texas-based company said it settled an SEC investigation into the restate of financial results stemming from allegedly fraudulent reimbursement practices by ArthroCare’s spinal business from 2006 through March 2008. An independent review of the alleged misconduct led to the departure of then-president and CEO Michael Baker in February 2009, along with the former VP of the spine unit and a sales and training director.
That’s all in the past now, with the company consenting to "the entry of an administrative order" directing it to "cease and desist from committing or causing violations of the reporting, books and records and internal control provisions of the federal securities laws," according to a press release.
"The company consented to the entry of the order without admitting or denying the order’s assertions of factual findings. No monetary penalty or fine will be imposed on the company, and none of the company’s current officers or employees were charged," according to the release. "In accepting the settlement, the SEC specifically considered the company’s remedial actions and the substantial cooperation it provided in connection with the SEC investigation."
In November, ArthroCare won 510(k) clearance for its SpeedFix suture anchor system for the repair of labrum tears in the shoulder.