According to a release sent out by the SEC, BMW kept a reserve of unreported retail sales that it used to reach company targets, ignoring actual time of when the sales took place. The agency also says BMW paid dealers to label vehicles as loaners or demonstrators so they could count them as sold. BMW reported the misleading sales information while going on to raise $18 billion from investors in corporate bond offerings.
The Security and Exchange Commission as such entered into a settlement with the automaker, with an $18 million fine for inflating sales numbers in the U.S. from 2015 to 2019.
“Companies accessing U.S. markets to raise capital have an obligation to provide accurate information to investors,” said Stephanie Avakian, Director of the Division of Enforcement. “Through its repeated disclosure failures, BMW misled investors about its U.S. retail sales performance and customer demand for BMW vehicles in the U.S. market while raising capital in the U.S.”
Although BMW cooperated with the investigation and agreed to the settlement, it would not admit nor deny the SEC’s findings. BMW AG, BMW of North America, and BMW US Capital agreed to pay the joint penalty and to refrain from committing the same violations in the future.