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Vince McMahon, the co-founder of World Wrestling Entertainment (WWE), has agreed to pay over $1.7 million to settle charges brought by the Securities and Exchange Commission (SEC). The case stems from allegations that McMahon failed to disclose settlement agreements tied to sexual misconduct allegations, circumventing WWE's internal controls and misstating financial reports. This development marks the culmination of a three-year investigation into McMahon's actions as WWE CEO.
The SEC's investigation revealed that McMahon made two undisclosed payments totaling $10.5 million. In 2018, a former WWE employee received $3 million, and in 2021, a female contractor was paid $7.5 million, both in exchange for silence over misconduct allegations.
These payments caused WWE to overstate its 2018 net income by approximately 8% and its 2021 income by 1.7%. "Company executives cannot withhold material agreements from their company's auditors and internal control functions," said Thomas P. Smith Jr., Associate Regional Director of the SEC's New York Office, in a statement.
McMahon agreed to the settlement without admitting or denying the allegations. As part of the resolution, he will pay a $400,000 civil penalty and reimburse WWE approximately $1.33 million.
McMahon addressed the matter publicly, stating, "Today ends nearly three years of investigation by different governmental agencies. There was never anything more to this than minor accounting errors related to personal payments. I'm thrilled to put this behind me."
However, McMahon's legal troubles are far from over. A criminal investigation by U.S. prosecutors continues, and a civil lawsuit filed by former WWE employee Janel Grant alleges sexual assault and trafficking. Grant's attorney, Ann Callis, stated, "During his time leading WWE, Vince McMahon acted as if rules did not apply to him. The SEC's charges prove that the NDA coerced upon Ms. Grant violates the law. We look forward to presenting new evidence in court."
Reports suggest McMahon paid $14.6 million between 2006 and 2022 to suppress various allegations of sexual misconduct. These revelations led to his temporary departure from WWE in 2022. Despite stepping down, McMahon orchestrated a controversial return as executive chairman in early 2023, raising questions about accountability within WWE's leadership.
