The Securities and Exchange Commission says that it has settled charges against former WWE CEO Vince McMahon over his failure to disclose to the sports entertainment company's board and others that he signed two settlement agreements worth $10.5 million with two women in order for them not to reveal potential claims against himself and WWE.
McMahon from WWE鈥檚 parent company in January 2024 accusing him and another former executive of serious sexual misconduct. At the time, stepped down from his position as executive chairman of the board of directors at WWE鈥檚 parent company, TKO Group Holdings. He continued to deny wrongdoing following the filing of the lawsuit.
as WWE鈥檚 CEO in 2022 amid an that match those in the lawsuit.
The SEC said Friday that one agreement was signed in 2019 and the other in 2022. One agreement required McMahon to pay a former employee $3 million in exchange for the former worker鈥檚 agreement to not disclose her relationship with McMahon and her release of potential claims against WWE and McMahon.
The other agreement obligated McMahon to pay a former WWE independent contractor $7.5 million in exchange for the independent contractor鈥檚 agreement to not disclose her allegations against McMahon and her release of potential claims against WWE and McMahon, the SEC said.
The commission said that by McMahon not disclosing the agreements to WWE鈥檚 board, legal department, accountants, financial reporting personnel, or auditor, it circumvented WWE鈥檚 system of internal accounting controls and caused material misstatements in the company鈥檚 2018 and 2021 financial statements.
The SEC鈥檚 order found that, because the payments required by the 2019 and 2022 agreements were not recorded, WWE overstated its 2018 net income by approximately 8% and its 2021 net income by about 1.7%.
Once WWE learned of the settlement agreements, it issued a restatement of its financial statements in August 2022.
鈥淐ompany executives cannot enter into material agreements on behalf of the company they serve and withhold that information from the company鈥檚 control functions and auditor,鈥� Thomas P. Smith Jr., associate regional director in the New York Regional Office, said in a statement.
The SEC said that McMahon, without admitting or denying its findings, agreed to cease-and-desist from violating certain provisions, pay a $400,000 civil penalty, and reimburse WWE approximately $1.3 million.
鈥淭oday ends nearly three years of investigation by different governmental agencies. There has been a great deal of speculation about what exactly the government was investigating and what the outcome would be. As today鈥檚 resolution shows, much of that speculation was misguided and misleading," McMahon said in a prepared statement. "In the end, there was never anything more to this than minor accounting errors with regard to some personal payments that I made several years ago while I was CEO of WWE. I鈥檓 thrilled that I can now put all this behind me.鈥�
Manhattan federal prosecutors declined to comment.
Ann Callis, a lawyer for Janel Grant, who is a former WWE employee against the company and , accusing him of sexual battery and trafficking, said in a statement that the SEC's charges are confirmation that McMahon broke the law to cover up his behavior.
鈥淭he SEC鈥檚 charges prove that the NDA Vince McMahon coerced Ms. Grant into signing violates the law, and therefore her case must be heard in court,鈥� Callis said. "While prosecutors for the Southern District of New York continue their criminal investigation, we look forward to bringing forward new evidence in our civil case.鈥�
The Associated Press does not normally name people who make sexual assault allegations unless they come forward publicly, which Grant did.
McMahon has denied Grant's allegations.
and most recognizable face at WWE for decades. When he purchased what was then the World Wrestling Federation from his father in 1982, wrestling matches took place at small venues and appeared on local cable channels. WWE matches are now held in professional sports stadiums and the company's weekly live television program, 鈥淩aw,鈥� made its on on Monday, where it had 4.9 million views globally and averaged 2.6 million households in the U.S., according to VideoAmp.
________
Associated Press writer Larry Neumeister contributed to this report.
Michelle Chapman, The Associated Press
