US SEC charges McDonald’s ex-CEO for misrepresentations

The SEC hit former CEO Stephen Easterbrook with a five-year officer and director bar and a $400,000 civil penalty.

McDonald's fired the ex-CEO in November 2019 for exercising 'poor judgment' by participating in a relationship with an worker [File: Mike Blake/Reuters]

The US Securities and Trade Fee (SEC) has charged former McDonald’s Corp Chief Government Stephen Easterbrook with making false and deceptive statements to traders concerning the circumstances of his 2019 termination.

The SEC hit Easterbrook with a five-year officer and director bar and a $400,000 civil penalty.

McDonald’s fired Easterbrook in November 2019 for exercising “poor judgment” by participating in a relationship with a McDonald’s worker, the SEC stated.

However Easterbrook did not disclose different further violations of firm coverage he dedicated by participating in undisclosed relationships with different staff of the fast-food big, it stated.

“When company officers corrupt inner processes to handle their private reputations or line their very own pockets, they breach their elementary duties to shareholders,” the SEC’s enforcement director Gurbir Grewal stated in a press release.

The company additionally charged McDonald’s with “shortcomings” in its public disclosures associated to Easterbrook’s removing, however didn't impose any fines on McDonald’s because of the agency’s “substantial cooperation” with the investigation, the SEC stated.

Attorneys for Easterbrook, who consented to the order however didn't admit or deny the SEC’s findings, didn't reply instantly to requires remark. McDonald’s stated in a press release that the settlement strengthened the actual fact it held Easterbrook “accountable for his misconduct”.

In 2021, Easterbrook returned greater than $105m he obtained as a severance package deal in 2019 and apologised to the corporate to settle a lawsuit over the alleged cover-up.

“We fired him, after which sued him upon studying that he lied about his conduct,” the agency stated in its assertion on Monday.

Republican SEC commissioners Hester Peirce and Mark Uyeda dissented in opposition to the fees in opposition to McDonald’s, saying the order turns the “sufferer of Mr. Easterbrook’s deception” right into a securities legislation violator.

The dissenting commissioners stated they've issues the case will create a “slippery slope” that expands public corporations’ disclosure necessities.