Accounting & Tax

Bisys Settles More Charges With SEC

Outsourcing services provider pays $25 million to settle restatement suit.
Stephen TaubNovember 6, 2006

The Bisys Group said it agreed to pay $25.1 million to settle a Securities and Exchange Commission investigation into previous restatements. The provider of outsourcing services to the financial services sector said that under the agreement, it would refrain from future violations of the reporting, books and records, and internal controls provisions of the federal securities laws and related SEC rules.

The restatements covered its financial statements from August 10, 2004 and from April 26, 2006. “We have been cooperating fully with the SEC staff throughout the course of their investigation and are pleased to have reached this proposed settlement,” said Robert Casale, chairman, and interim CEO and President, in a statement. “We are still catching up on our Sarbanes-Oxley and audit efforts for fiscal year 2006, with an emphasis on quality rather than speed,” added Bruce Dalziel, chief financial officer.

In September, Bisys, which provides several administration services to mutual fund families, agreed to pay $21.4 million to settle SEC charges that it helped more than two dozen mutual fund advisers in defrauding fund investors. Bysis allegedly entered into undisclosed side agreements with the advisers, which enabled the advisers to improperly to use investors’ mutual fund assets to pay for marketing expenses rather than paying for those expenses out of their own assets, according to the complaint.

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In 2004, reported that Bisys delayed the filing of its annual report for the fiscal year ended June 30 after a whistle-blower raised questions about its internal controls.