Express, Inc. Resolves SEC's Allegations of Secret Executive Compensation

Investing.com -- The Securities and Exchange Commission (SEC) announced that it has resolved charges against Ohio-based fashion retailer Express, Inc. The company was accused of failing to disclose approximately $1 million in executive compensation paid to its former CEO.

The SEC's order revealed that Express did not disclose $979,269 in perquisites and personal benefits provided to its CEO in its definitive proxy statement filings for the fiscal years 2019, 2020, and 2021. These benefits included certain expenses related to the use of a chartered airplane for personal reasons by the CEO. As a result, the CEO's compensation was shown to be on average 94% lower in the "Other Aggregate Compensation" section over the three fiscal years.

The company, which filed for Chapter 11 bankruptcy earlier this year, was determined to have violated Sections 13(a) and 14(a) of the Securities Exchange Act of 1934, as well as Rules 12b-20, 13a-1, 13a-15(a), 14a-3, and 14a-9.

Despite these violations, the SEC decided against imposing a civil monetary penalty on Express. This decision was based on the company's self-reporting of the issue, cooperation with the SEC's investigation, and measures taken to rectify the problem.

Sanjay Wadhwa, Acting Director of the SEC's Division of Enforcement, emphasized that public companies must fulfill their disclosure obligations relating to executive compensation, including perquisites and personal benefits, which is essential for investors to make informed investment decisions.

Express accepted a cease-and-desist order without admitting or denying the SEC's findings. The SEC's investigation was conducted by Ruta G. Dudenas and Ann Tushaus in the Chicago Regional Office, with oversight by Amy S. Cotter.