SEC Subpoenas Time Warner Honchos in Accounting Probe

23 October 2003

Former AOL Time Warner chairman Stephen M Case, current chairman Richard D Parson, and several other senior TW executives have been subpoenaed to appear before the US Securities and Exchange Commission.

They will be questioned over a $400 million (€342.06m; £237.79m)) advertising deal with German media giant Bertelsmann, according to people involved in the investigation. The SEC has also launched a wider probe into other aspects of Time Warner's accounting practices.

The media giant revealed that the SEC is pressing it to restate its past earnings, deducting part of the Bertelsmann payment, but TW is resisting this and standing by its accounting methods.

According to lawyers "sympathetic to Time Warner", the issuing of subpoenas does not in itself indicate the SEC is contemplating action against the recipients. Such interrogations are an inevitable part of an investigation of this nature, aver the legal eagles.

Data sourced from: New York Times; additional content by WARC staff