Former Bankrate Inc. Vice President Hyunjin Lerner was indicted for fraudulently inflating the company's performance for three years.
Lerner was charged with conspiracy, wire fraud, securities fraud, falsifying the company's books and making false statements to the company's accountants.
The indictment alleges that between 2011 and 2014, Lerner and others carried out a complex scheme to manipulate Bankrate’s financial statements and artificially inflate its earnings, according to the Department of Justice. Lerner and his co-conspirators allegedly left expense accruals on the company's books and then carefully reversed them in later quarters to meet earnings goals.
In addition, Lerner and others misrepresented company expenses as “deal costs” in order to artificially inflate publicly reported adjusted earnings metrics; booked hundreds of thousands of dollars in unsupported revenue to further inflate Bankrate’s reported revenue and earnings; and made materially false statements to conceal the improper accounting entries from the company's auditors, shareholders and the public, the DOJ said.
In 2015, the company settled with the SEC for $15 million for the same charges against Lerner. At the time, Lerner agreed to pay a $150,000 penalty, as well as full disgorgement of $30,045 in gains from selling Bankrate stock after the company announced false financial results.