U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 21930 / April 14, 2011
Accounting and Auditing Enforcement Release No. 3270 / April 14, 2011
Securities and Exchange Commission v. Rebecca Lynn Higgins, Civil Action No. 3:11-cv-763 (N.D. Tex.)
SEC Settles with Former Zale Employee for her Role in Improper Advertising Expense Accounting
On April 14, 2011, the Securities and Exchange Commission filed a settled civil action in United States District Court for the Northern District of Texas, Dallas Division, against Rebecca Lynn Higgins, a former vice president of marketing at Zale Corporation. The Commission’s complaint alleges that, between 2004 and 2009, Higgins caused Zale to record certain television advertising costs as prepaid advertising when, in fact, those costs should have been expensed in the periods in which they were incurred. According to the Commission, as a result of Higgins’s actions, Zale’s publicly reported prepaid advertising and advertising expense for these periods were materially misstated.
Without admitting or denying the Commission’s allegations, Higgins has consented to entry of a final judgment permanently enjoining her from aiding and abetting violations of Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934 and Rules 12b-20, 13a-1, and 13a-13 thereunder. She also has agreed to pay a $25,000 civil penalty.