Mexico’s TV Azteca May Settle Fraud Suit by SEC
TV Azteca, Mexico’s second-largest broadcaster, may settle a fraud lawsuit filed by the U.S. Securities and Exchange Commission in January 2005 over a loan that the agency said wasn’t properly reported to shareholders.
Under the proposed settlement, the SEC wouldn’t levy economic penalties against Mexico City-based TV Azteca. Ricardo Salinas, chairman of TV Azteca, and company executive Pedro Padilla “would bear the monetary costs resulting from this proposal,†TV Azteca said in an e-mail statement.
The SEC will decide within 90 days whether to proceed with the settlement, the company said.
The SEC said Salinas and a partner, Moises Saba, paid a discount price of $107 million in June 2003 for $325 million of debt that Unefon owed to Nortel Networks Corp. Unefon was a mobile-telephone unit of TV Azteca at that time. Three months later, Unefon bought back the debt at full value from Salinas and Saba. The SEC requires companies to report such related-party transactions.
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