The SEC Comes Down on Miller Energy Resources Inc (OTCMKTS:MILL)
Yesterday the Securities and Exchange Commission charged Miller Energy Resources Inc (OTCMKTS:MILL) along with two of its executives with accounting fraud. MILL stock slipped 17% in the last market session, stopping at $0.14 flat by the closing bell.
The SEC’s charges against the company, former CFO Paul Boyd and MILL‘s current COO David Hall revolve around inflating the value of company assets in Alaska. According to the SEC press release, MILL overstated the value of oil and gas properties by more than $400 million, after acquiring them back in 2009.
The matter involves what SEC officials call falsification of financial statements and “gross overstatement”, not just a minor error. The company paid only $2.5 million in cash and assumed certain liabilities in the Alaska properties purchase deal. However, later MILL reported the same properties with a value of $480 million.
MILL was only recently delisted from the New York Stock Exchange, after failing to maintain a market cap of $15 million or more for the past month. The SEC charges come just a few days after the ticker switched to trading on the OTC.
Yesterday two Form 4 filings came through, informing that CEO Fredrick Giesler terminated a grant of 600,000 shares and CFO Phillip Elliott terminated another one of 300,000 shares.
The impact of the SEC charges levied against the company will very likely have a further impact on the company’s chart standing beyond yesterday’s drop. MILL was trading at prices exceeding $2 per share in early 2015.