Photo: BMW
Lying to the people who own shares in a company is bad. BMW did it from 2015 to 2019, according to the Securities and Exchange Commission, and even though the German automaker disclosed misleading sales figures for five straight years, the SEC agreed to a settlement of $18 million.
Despite this illegal practice, BMW shares have gone down in value during this period. Adding insult to injury, the Bavarian manufacturer has raised $18 billion from investors from 2015 to 2019 by feeding them false information.
BMW, therefore, misled the people who believe the most in the company about its "U.S. retail sales performance and customer demand in this market while raising capital in the United States.” The Securities and Exchange Commission highlights “significant cooperation during the investigation amid challenges posed by the health crisis,” and this openness “was taken into account in imposing a penalty” according to the governmental agency.
No fewer than three legal entities – BMW AG, BMW NA, and BMW US Capital – violated the antifraud provisions of the Securities Act of 1933. It should be highlighted that the penalty comes as a result of “not admitting or denying the order’s findings.” In other words, no executive will be held accountable because the automaker will pony up $18 million.
The Bavarians aren’t alone, though. Closer to home, Fiat Chrysler Automobiles paid $40 million to settle a similar problem. To make a long story short, FCA instructed dealers to report fake figures from 2012 to 2016, helping the company’s capitalization on the stock market.
So far this year, BMW of North America had it rough. The BMW and MINI brands reported decreases of 15.3 and 35.1 percent in Q1 of 2020 as opposed to the first quarter of 2019. The health crisis translated to even worse results in Q2, namely decreases of 39.3 and 41.5 percent.
On a related note, did you know that the U.S. is a net exporter of BMWs? More Bimmers are exported from the United States than imported, which is hardly surprising if you remember that the X3, X4, X5, X6, and X7 utility vehicles are all made in this part of the world.
BMW, therefore, misled the people who believe the most in the company about its "U.S. retail sales performance and customer demand in this market while raising capital in the United States.” The Securities and Exchange Commission highlights “significant cooperation during the investigation amid challenges posed by the health crisis,” and this openness “was taken into account in imposing a penalty” according to the governmental agency.
No fewer than three legal entities – BMW AG, BMW NA, and BMW US Capital – violated the antifraud provisions of the Securities Act of 1933. It should be highlighted that the penalty comes as a result of “not admitting or denying the order’s findings.” In other words, no executive will be held accountable because the automaker will pony up $18 million.
The Bavarians aren’t alone, though. Closer to home, Fiat Chrysler Automobiles paid $40 million to settle a similar problem. To make a long story short, FCA instructed dealers to report fake figures from 2012 to 2016, helping the company’s capitalization on the stock market.
So far this year, BMW of North America had it rough. The BMW and MINI brands reported decreases of 15.3 and 35.1 percent in Q1 of 2020 as opposed to the first quarter of 2019. The health crisis translated to even worse results in Q2, namely decreases of 39.3 and 41.5 percent.
On a related note, did you know that the U.S. is a net exporter of BMWs? More Bimmers are exported from the United States than imported, which is hardly surprising if you remember that the X3, X4, X5, X6, and X7 utility vehicles are all made in this part of the world.
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