Fifth Third Shares Halted to Announce Settlement with SEC, Names Tuzun CFO
Fifth Third Bancorp (NASDAQ: FITB) today announced that it has reached an agreement in principle with the Staff of the Securities and Exchange Commission (“SEC”) to settle a previously disclosed investigation by the SEC into Fifth Third's accounting for certain commercial loans that Fifth Third sold or reclassified as held-for-sale in the fourth quarter of 2008. At dispute in this matter is whether certain of those loans should have been moved to held-for-sale in the third quarter of that year.
To put into effect the agreement in principle, Fifth Third, without admitting or denying any factual allegations, would consent to the SEC's issuance of an administrative order finding that the Company did not properly account for a portion of its commercial real estate loan portfolio in its form 10-Q for the third quarter of 2008 in violation of Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933 and Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934. The proposed settlement would also order the Company to cease and desist from committing or causing any such violations in the future and to pay a civil money penalty. Fifth Third believes it is appropriately reserved with respect to the proposed settlement. Daniel T. Poston, the Company's interim chief financial officer during the relevant time, is in separate settlement discussions with the SEC staff concerning a settlement pursuant to which Mr. Poston, without admitting or denying any factual allegations, would consent to similar findings and charges against him, a cease and desist order, a separate civil money penalty, and a one-year ban from practicing before the SEC. The proposed settlement is subject to approval by the Commissioners of the SEC, and there can be no assurance that the Commissioners will approve a settlement on the terms described above.
In connection with these proposed settlements, Fifth Third is implementing certain management changes. Mr. Poston has been named the Company's chief strategy and administrative officer. In his new position, Mr. Poston will oversee the activities of Strategic Planning, Distribution Strategy, Capital Planning, Mergers and Acquisitions, Corporate Facilities, and Strategic Sourcing, and will report to Kevin T. Kabat, vice chairman and chief executive officer of Fifth Third Bancorp and Fifth Third Bank.
Tayfun Tuzun, previously Fifth Third's treasurer, has been named executive vice president and chief financial officer, effective October 31, 2013. He will also report directly to Mr. Kabat. Mr. Tuzun joined Fifth Third Bancorp in 2007 and was named treasurer in 2011. He holds both master's and doctorate degrees in economics from The Ohio State University, and a bachelor's degree in economics from Bosphorus University in Turkey. He has held senior positions in finance and treasury with Provident Bank, and he was also previously a faculty member at the University of New South Wales.
Mary Tuuk, Board secretary and executive vice president of Corporate Services, will add responsibility for Compliance. Two functions now reporting to Mr. Poston, Facilities and Strategic Sourcing, previously reported to Ms. Tuuk.
Jamie Leonard has been named treasurer, reporting to Mr. Tuzun. He joined Fifth Third Bank in 1999 and has held a number of senior roles in Finance. He most recently served as senior vice president and director of Business Planning and Analysis. Mr. Leonard received his bachelor's degree from Miami University and is a certified public accountant.
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.