Press Release

SEC Charges Seismic Data Company, Former Executives With $100 Million Accounting Fraud

For Immediate Release


Washington D.C., Oct. 8, 2020 —

The Securities and Exchange Commission today charged Houston-based seismic data company, SAExploration Holdings Inc. (SAE), and four former executives for a multi-year accounting fraud that falsely inflated the company’s revenue by approximately $100 million and concealed the theft of millions of dollars by the executives. SAE issued restated financial statements in February and declared bankruptcy in August.

According to the SEC's complaint, starting in 2015, SAE, at the direction of the four executives – former CEO and Chairman Jeffrey Hastings, former CFO and General Counsel Brent Whiteley, former CEO and COO Brian Beatty, and former VP of Operations Michael Scott – entered into a series of seismic data acquisition contracts totaling approximately $140 million with a purportedly unrelated Alaska-based company that was in fact controlled by Hastings and Whiteley. The complaint alleges that, of the amount SAE recorded in revenue, approximately $100 million was improperly recorded in light of the Alaskan company's inability to pay and the SAE executives' control of the company. As alleged in the complaint, to create the false impression that the Alaskan company was actually paying SAE for seismic data, Hastings, Whiteley, Beatty, and Scott misappropriated nearly $6 million from SAE and used the funds for a series of round trip transactions that caused the money to be sent back to SAE. The complaint alleges that, in addition, the executives also stole a total of approximately $6 million for themselves. The complaint further alleges that Whiteley separately misappropriated an additional $4 million through a fictitious invoice scheme.

"As alleged in our complaint, SAE's executives designed a multi-faceted fraud that enriched executives at the expense of investors," said Jennifer Leete, an Associate Director in the Division of Enforcement. "We will vigorously pursue wrongdoing by individuals and companies who engage in fraud and mislead investors."

The SEC's complaint charges the defendants with violating the antifraud, books and records, and internal accounting controls provisions of the federal securities laws. The complaint also charges SAE with violating the reporting provisions of the federal securities laws and the four executives with aiding and abetting those violations. The SEC seeks a permanent injunction against SAE and permanent injunctions, civil penalties, disgorgement of allegedly ill-gotten gains with prejudgment interest, and officer-and-director bars against the four executives. Additionally, the SEC seeks to have Hastings, Whiteley, and Beatty reimburse SAE for incentive-based compensation pursuant to Section 304(a) of the Sarbanes-Oxley Act. The complaint also charges Hastings's and Whiteley's spouses, Lori Hastings and Thomas O'Neill, as relief defendants and seeks disgorgement of allegedly ill-gotten gains plus prejudgment interest.

In a parallel action, the U.S. Attorney's Office for the Southern District of New York announced criminal charges against Hastings.

The SEC's investigation was conducted by Yael Berger, Peter Fielding, and Andrea Fox, and supervised by Stacy Bogert and Peter Rosario. The litigation will be led by Nick Margida and supervised by Stephan Schlegelmilch. The SEC appreciates the assistance of the U.S. Attorney's Office for the Southern District of New York and the Federal Bureau of Investigation.


Last Reviewed or Updated: Oct. 8, 2020