016: Stiefel Labs SEC Charges


On December 12, 2011, the SEC filed an enforcement action in the US District Court for the Southern District of Florida, against Stiefel Laboratories and Charles Stiefel, the company’s former Chairman and CEO. The action alleged that both engaged in a fraudulent stock scheme in violation of Section 10b of the Exchange Act and Rule 10b-5.

Investigators claimed that Stiefel defrauded its shareholders, who were mainly current and former employees of Stiefel Labs, out of more than $110 million by buying back shares of Stiefel Labs stock from their employees at severely undervalued prices.

The information in this case study comes from the SEC press release and related articles.