Vince McMahon, co-founder and former CEO of WWE, and the Securities and Exchange Commission (SEC) reached a settlement following a year-long investigation into undisclosed deals.
The federal investigation was launched to determine whether McMahon revealed to the company’s board of directors and others that he signed two settlement agreements worth more than $10 million with two women to keep them from disclosing potential claims against him and the WWE.
The SEC said that McMahon, without admitting or denying its findings, agreed to cease and desist from violating certain provisions, pay a $400,000 civil penalty and reimburse WWE approximately $1.3 million.
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WWE Chairman and CEO Vince McMahon speaks at a press conference announcing WWE Network at the 2014 International CES at the Encore Theater at the Wynn Las Vegas in Las Vegas on January 8, 2014. (Ethan Miller/Getty Images)
McMahon issued a statement on Friday, arguing that the situation was the result of “minor accounting errors.”
“The case is closed. Today ends almost three years of investigation by different government agencies. There has been 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,” the statement said. “In the end, there was never anything more than minor accounting errors regarding some personal payments I made several years ago while I was CEO of WWE. I am delighted to be able to put all of this behind me.”
Federal prosecutors declined to comment.
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SEC officials said Friday that one agreement was signed in 2019 and the other in 2022. One agreement required McMahon to pay a former employee $3 million in exchange for the former worker’s agreement not to disclose his relationship with McMahon and his release of possible claims against WWE. and McMahon.
The other agreement required McMahon to pay a former WWE independent contractor $7.5 million in exchange for the independent contractor’s agreement not to disclose his allegations against McMahon and his release from potential claims against WWE and McMahon, according to the SEC. .
WWE owner Vince McMahon enters the arena during WrestleMania at AT&T Stadium in Arlington, Texas, on April 3, 2022. (Joe Camporeale-USA TODAY Sports)
McMahon resigned from his position as president and CEO of the popular professional wrestling promotion in 2022, pending the results of an internal investigation that arose from allegations of hush agreements. His daughter Stephanie McMahon took over her father’s leadership duties.
A few weeks after leaving office, McMahon announced his intentions to retire from WWE. He returned as CEO in 2023, but resigned from TKO, a company that was the result of a merger between WWE and Zuffa, the parent company of the UFC, in 2024. McMahon’s resignation came after a former employee filed a lawsuit federal prosecutor accusing him and another. former executive of serious sexual misconduct.
McMahon maintained that he committed no crime after filing the lawsuit.
WWE Chairman and CEO Vince McMahon attends a press conference to announce WrestleMania XXIX at MetLife Stadium in East Rutherford, New Jersey on February 16, 2012. (John W. Ferguson/WireImage)
By failing to disclose the agreements to WWE’s board of directors, legal department, accountants, financial reporting staff or auditors, McMahon circumvented the company’s system of internal accounting controls and caused material misstatements in its financial statements. 2018 and 2021, the commission said.
The SEC order found that, because payments required by the 2019 and 2022 agreements were not recorded, WWE overstated its 2018 net income by approximately 8% and its 2021 net income by approximately 1.7%. .
Once WWE learned of the settlement agreements, it issued a restatement of its financial statements in August 2022.
