Vince McMahon Resolves SEC Charges for Undisclosed Agreements
The Securities and Exchange Commission (SEC) has reached an agreement with former WWE CEO Vince McMahon following accusations of failing to disclose settlement agreements. These agreements, valued at $10.5 million, were signed with two women to prevent the disclosure of potential claims against him and the company.
According to the SEC, McMahon, without admitting or denying its findings, agreed to cease and desist from violating certain provisions, pay a civil penalty of $400,000, and reimburse WWE approximately $1.3 million.
“Today concludes nearly three years of investigation by different government agencies. There was a lot 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 wrong and misleading,” McMahon said in a statement. “In the end, this was nothing more than minor accounting errors regarding some personal payments I made several years ago when I was CEO of WWE. I am pleased to be able to put all of this behind me.”
Vince McMahon
McMahon resigned as executive chairman of the board of directors of TKO Group Holdings, the parent company of WWE, in January 2024, after a former employee filed a federal lawsuit accusing him of sexual misconduct. Previously, in 2022, he had stepped down as CEO of WWE amid an investigation into similar allegations.
The SEC revealed that one of the agreements was signed in 2019 and the other in 2022. The 2019 agreement obligated McMahon to pay a former employee $3 million in exchange for her not disclosing her relationship with him and waiving potential claims against WWE and McMahon. The second agreement, from 2022, required McMahon to pay an independent WWE contractor $7.5 million, also in exchange for her not disclosing her accusations and waiving claims.
Ann Callis, lawyer for Janel Grant, a former WWE employee who filed a lawsuit against the company and McMahon for sexual assault and trafficking, stated that the SEC charges confirm that McMahon violated the law to cover up his behavior. Callis added that they expect to present new evidence in the civil case.
The SEC determined that, by not disclosing these agreements to the board of directors, the legal department, the accountants, and WWE’s auditor, McMahon circumvented the company’s internal control system, which caused misstatements in its 2018 and 2021 financial statements. As a result, WWE overstated its net income in 2018 by approximately 8% and in 2021 by approximately 1.7%.
After learning about the agreements, WWE issued a restatement of its financial statements in August 2022.
“The company’s executives cannot enter into significant agreements on behalf of the company they serve and withhold that information from the company’s control functions and auditor,” said Thomas P. Smith Jr., associate regional director of the New York Regional Office.
Thomas P. Smith Jr.
Vince McMahon was the main and most recognizable figure in WWE for decades. Under his leadership, the company has experienced significant growth, moving from events in small venues to professional sports stadiums. WWE’s weekly television program, “Raw”, recently debuted on Netflix, where it accumulated millions of views worldwide.
