Activision Blizzard has finally reached a settlement with the Securities and Exchange Commission (SEC) that will see the gaming giant pay $35 million for workplace charges.
The SEC’s press release states Activision Blizzard is paying the settlement fee, but not admitting or denying any wrongdoing. This is in regards to claims that it “failed to maintain disclosure controls and procedures to ensure that the company could assess whether its disclosures pertaining to its workforce were adequate.”
Furthermore, the $35 million also pertains to charges that Activision Blizzard “violated an SEC whistleblower protection rule.”
The SEC said between 2018 and 2021, Activision Blizzard “lacked controls and procedures” in relation to how it collected and analyzed complaints about workplace misconduct among its divisions.
“A a result, the company’s management lacked sufficient information to understand the volume and substance of employee complaints about workplace misconduct and did not assess whether any material issues existed that would have required public disclosure,” the SEC said. “Separately, the SEC’s order finds that, between 2016 and 2021, Activision Blizzard executed separation agreements in the ordinary course of its business that violated a Commission whistleblower protection rule by requiring former employees to provide notice to the company if they received a request for information from the Commission’s staff.”
Jason Burt, director for the SEC’s Denver office, said Activision Blizzard’s actions left the company “without the means to determine whether larger issues existed and needed to be disclosed to investors.” In regards to the whistleblower complaints, Burt stated this is “not only bad corporate governance, it is illegal.”
To be more specific, the SEC said Activision Blizzard violated Exchange Act Rules 13a-15(a) and 21F-17(a). The SEC, again, stated that Activision Blizzard is not admitting or denying the SEC’s charges, but simply agreeing to the settlement to end the case.
The SEC’s order says the settlement payment pertains to disclosure controls and Activision Blizzard’s separation agreements.