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U.S. Securities and Exchange Commission

SEC Announces Distribution of $48 Million to Defrauded Vivendi Universal Investors


Washington, D.C., Aug. 11, 2008 — The Securities and Exchange Commission today announced the distribution of more than $48 million to more than 12,000 investors who were victims of fraudulent financial reporting by media conglomerate Vivendi Universal, S.A. Investors receiving checks reside in the United States and in 15 other countries. More than half bought their Vivendi stock on foreign exchanges and are receiving their Fair Fund distribution in euros.

"Today we are able to provide financial remediation to investors who were misled by Vivendi's false financial reporting," said David Nelson, Regional Director of the Commission's Miami Regional Office. "I am particularly gratified that we have been able to identify and help investors not just in this country, but overseas as well."

Dick D'Anna, Director of the SEC's Office of Collections and Distributions, said, "This distribution highlights the continued efforts and increased capacity of the Commission to repay injured investors, regardless of their physical location and their currency of choice. Our ongoing focus will be to improve our assistance to these investors."

The Commission filed a settled enforcement action in December 2003 against Vivendi, its former CEO Jean-Marie Messier, and its former CFO, Guillaume Hannezo, alleging violations of the antifraud and other provisions of the federal securities laws. Among other things, the Commission alleged that the defendants engaged in antifraud violations by making misleading statements about Vivendi's financial condition. According to the Commission's complaint, the defendants engaged in misconduct that disguised Vivendi's cash flow and liquidity problems, improperly adjusted accounting reserves to meet earnings targets, and failed to disclose material financial commitments.

As part of their settlement, which was without admitting or denying the Commission's allegations, the defendants agreed to certain financial relief. Vivendi agreed to pay a $50 million civil money penalty and disgorgement of $1. Messier agreed to pay a $1 million civil penalty and disgorgement of $1, and Hannezo agreed to pay disgorgement and a civil money penalty totaling more than $250,000. The Fair Funds being distributed today come from all of those financial payments. In addition to that relief, Messier also agreed to forfeit a severance package of about 21 million euros.

In the Fair Funds provisions of the Sarbanes-Oxley Act of 2002, Congress gave the Commission increased authority to distribute ill-gotten gains and civil money penalties to harmed investors. To date, the Commission has returned more than $4 billion to investors since 2002.

Of the 12,115 investors receiving checks, approximately 5,300 are from the United States or receiving claims in dollars. The remaining 6,800 claimants are from 15 countries, including more than 3,300 claimants who bought shares on the Paris Stock Exchange. They will receive checks in Euros. The distribution agent in the case hopes to make a second, smaller distribution in the future.

Questions regarding the Fair Fund distribution may be directed to the Court-appointed distribution agent, Jeffrey Sklaroff, Esq., by:

  • Sending an e-mail to Questions@vivendisecsettlement.com or visiting the fund website at http://www.vivendisecsettlement.com

  • Calling toll-free 1-800-295-3152 in the United States or visiting the fund website for toll-free numbers in other countries;

  • Writing to Jeffrey Sklaroff, Esq., at either Greenberg Traurig, LLP, 200 Park Avenue, New York, New York, 10166, or c/o the Garden City Group, Vivendi SEC Settlement Fund Administration, P.O. Box 9000 #6371, Merrick, NY 11566-9000

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Modified: 08/11/2008