A Korean-American executive has been charged with accounting misconduct at a publicly traded company based in Connecticut.
The Securities and Exchange Commission (SEC) said on October 29 that it charged furniture retailer Lovesac Company and two former executives, including former Controller and Vice President Yoon Um for securities law violations and accounting fraud.
According to the SEC, Um worked with former Chief Financial Officer (CFO) Donna Dellomo and failed to properly account for expenses related to furniture deliveries.
The SEC’s complaint, filed in federal court in the U.S. District Court for the District of Connecticut, states that Lovesac failed to properly record the costs associated with shipping finished goods from its distribution centers to customers. The company’s finance team found that invoices for shipped products were not properly recorded from April 2023 through the first quarter of 2024.
The SEC alleges that such accounting irregularities caused inaccurate fiscal year 2023 SEC filings. The SEC accused Um and others concealed $2.2 million in shipping costs through accounting misstatements.
The complaint also alleges that Lovesac Company signed and submitted inaccurate accounting documents to the SEC. The company agreed to pay a $1.5 million penalty for the accounting misconduct.
BY HYOUNGJAE KIM, HOONSIK WOO [kim.ian@koreadaily.com]
