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Marvell Tech To Pay $5.5 Mln To Settle Disclosure-related Charges

Marvell Technology Group Ltd. agreed to pay $5.5 million to settle charges that the company misled investors when it engaged in an undisclosed revenue management scheme in order to meet publicly-issued revenue guidance, the U.S. Securities and Exchange Commission said.

The firm consented to the SEC order without admitting or denying the agency's findings.

According to the SEC's order, Marvell orchestrated a scheme to accelerate, or "pull-in," sales to the current quarter that had been scheduled for future quarters. The purpose of the pull-in sales, which took place during the fourth quarter of 2015 and first quarter of 2016, was to close the gap between actual and forecasted revenue and to meet publicly-issued revenue guidance.

According to the SEC's order, Marvell's use of pull-ins masked a substantial decline in customer demand, a loss of market share and reduced future sales.

Further, the order stated that Marvell ignored internal concerns that the pull-ins were obfuscating the company's deteriorating financial results.

According to the order, by failing to disclose its use of the pull-ins, Marvell misled investors in its SEC quarterly filings and in earnings calls, making positive statements regarding its fourth quarter 2015 financial results and stating that it had met its public guidance for the first quarter of 2016.

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