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Bally Settles After SEC Investigation

The Securities and Exchange Commission recently agreed to a settlement that will resolve a three-year fraud investigation into past revenue reporting inaccuracies by Bally Technologies.
In the settlement, Bally agreed to a cease-and-desist order requiring the company to comply with federal regulations regarding internal controls and revenue reporting. Bally did not admit or deny any past wrongdoing in the settlement.
Richard Haddrill, Bally CEO, told the Las Vegas Sun the company is “pleased with this resolution of the SEC investigation, which allows us to put these matters behind us as we continue to execute our strategies for the long-term success of our business.”
On the same day the company’s settlement was approved, the SEC filed complaints against former Bally executives Steven M. Des Champs, former chief accounting officer; and Martha W. Vlcek, former vice president of finance.
The SEC filings accused Des Champs and Vlcek of making “misleading disclosures and omissions regarding revenue recognition” and making “materially false statements to the company’s outside auditors when they represented the transactions were proper.”
The company’s revenue reports were inflated from 2003 to 2004 as a result of the reporting inaccuracies. Des Champs and Vlcek face actions in U.S. District Court. Bally Technologies has not been charged with fraud or penalized for the reporting inaccuracies.