(The news featured below is a selection from the news covered in Federal Securities Law Reporter, which is distributed to subscribers of Federal Securities Law Reporter.)

Mortgage Company CEO Caused Reporting Violations

The SEC entered a cease and desist order against the former CEO of a mortgage banking company. The Commission found that the individual caused the company to record only half of an adjustment necessary to make the company's financial statements comply with Generally Accepted Accounted Principles. The SEC charged that the individual knew or should have known that failing to record the full mortgage revenue adjustment enabled the company to appear to meet a key financial covenant required to save the company's sole line of credit.

Release No. 34-55568 is reported at ¶87,786.