ICON Capital Fined by SEC for Accounting Irregularities
ICON Capital LLC, a manager of a series of equipment leasing funds, received a cease and desist order by the Securities and Exchange Commission for various accounting errors made relating to Icon Income Fund Nine, Icon Income Fund Ten, Icon Leasing Fund Eleven, and Icon Leasing Fund Twelve. The company was ordered to pay a civil money penalty of $750,000 to the SEC.
Icon Capital is owned by ICON Investment Group LLC, which also sponsors CĪON Investment Corporation, a non-traded business development company.
“We are glad to put the matter behind us and are pleased that after a comprehensive three-year investigation, the SEC order contains no findings of bad faith and no findings that anyone engaged in any intentional wrongdoing,” said Michael A. Reisner, co-president and co-chief executive officer of Icon. “While we do not admit or deny the SEC’s findings, we note that our outside auditors continue to stand by their clean audit opinions.”
The SEC says that because of inadequate internal accounting controls and the misapplication of Generally Accepted Accounting Principles in certain instances, Icon did not report accurate financial results, and had inaccuracies in books and records, for the four leasing funds from 2009 through 2012.
Icon’s accounting errors resulted in, among other things, one or more of the funds not taking certain required asset value impairments, overstating post-impairment values or overstating residual values in multiple reporting periods. Icon’s errors resulted in overstatements of net income (or understatements of net loss) and overstated asset and leasing fund members’ equity values.
