Former WWE CEO Vince McMahon, Securities and Exchange Commission reach settlement after lengthy probe
Vince McMahon, who co-founded and previously served as the CEO of WWE, and the Securities and Exchange Commission (SEC) have reached a settlement following a yearslong probe over undisclosed settlements.
The federal investigation was launched to determine whether McMahon disclosed to the company's board and others that he signed two settlement agreements worth more than $10 million with two women in order for them not to reveal potential claims against himself and WWE.
The SEC said 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.
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McMahon released a statement on Friday, arguing the situation was the result of "minor accounting errors."
"The case is closed. Today 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's resolution shows, much of that speculation was misguided and misleading," the statement read. "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'm thrilled that I can now put all this behind me."
Federal prosecutors declined to comment.
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SEC officials on Friday said 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's 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's agreement to not disclose her allegations against McMahon and her release of potential claims against WWE and McMahon, per the SEC.
McMahon stepped down from his role as chairman and CEO of the popular professional wrestling promotion in 2022, pending the results of an internal investigation which stemmed from allegations of hush-money agreements. His daughter Stephanie McMahon assumed her father's leadership duties.
A few weeks after stepping down, McMahon announced his intentions to retire from WWE. He returned as executive chairman in 2023, but resigned from TKO — a company that was the result of a merger between the WWE and Zuffa, UFC's parent company — in 2024. McMahon's resignation came after a former employee filed a federal lawsuit accusing him and another former executive of serious sexual misconduct.
McMahon maintained he committed no wrongdoing following the filing of the lawsuit.
By McMahon not disclosing the agreements to WWE's board, legal department, accountants, financial reporting personnel or auditors, it circumvented the company's system of internal accounting controls and caused material misstatements in its 2018 and 2021 financial statements, the commission said.
The SEC's 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.
"Company executives cannot enter into material agreements on behalf of the company they serve and withhold that information from the company's control functions and auditor," Thomas P. Smith Jr., associate regional director in the New York Regional Office, said in a statement.
The Associated Press contributed to this report.
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