Dallas Gold & Silver Exchange, a jewelry company, created and filed with the Commission materially inaccurate financial statements since 2009. I. John Benson, the Chief Financial Officer of DGSE, was found to manipulate the amounts of inventory for 2009 and 2010 by inflating millions of dollars (Jacobson, 2012). He exploited the inappropriate controls of DGSE and made some fraudulent accounting entries; He concealed them with false inventory details and management representation letter. Mr. Benson violated Section 17(a) (1)-(3), Section 13 (b) (5) and Section 13 (a) of the Exchange Act and was charged $75,000 as a penalty and was permanently banned being an officer of a public company. (Securities and Exchange Commission v. DGSE Companies Inc. and I. John Benson, 2014)
2. Company Profile
Industry Background & Company history: Dallas Gold & Silver Exchange (Nasdaq: DGSE) was founded in Dallas, Texas in 1965. As a wholesaler and retailer, DGSE exchanges collectibles and valuables such as jewelry, diamonds, scrap gold, silver or rare coins through its exchanges located in different areas and the internet. It was listed on the US Stock Exchange in 2007. According to the FORM 10-K of DGSE, up to the end of the fiscal year ended December 31, 2014, the companies owned 12 retail locations in Illinois, South Carolina and Texas, and 79 …show more content…
§ 77q (a) (2)], which requires the company should have known that its statement was misleading. Neither the controller nor the board of directors noticed the irregularities on the financial statements for 2009 and 2010 until 2012. The company also violated Section 13(a) of the Exchange Act [15 U.S.C. § 78m (a)] and Rules 12b-20, 13a-1, and 13a-13 because it did not file with the Commission the accurate financial reports which fairly reflected its transactions and dispositions of its assets. (Securities and Exchange Commission v. DGSE Companies Inc. and I. John Benson,
2. Company Profile
Industry Background & Company history: Dallas Gold & Silver Exchange (Nasdaq: DGSE) was founded in Dallas, Texas in 1965. As a wholesaler and retailer, DGSE exchanges collectibles and valuables such as jewelry, diamonds, scrap gold, silver or rare coins through its exchanges located in different areas and the internet. It was listed on the US Stock Exchange in 2007. According to the FORM 10-K of DGSE, up to the end of the fiscal year ended December 31, 2014, the companies owned 12 retail locations in Illinois, South Carolina and Texas, and 79 …show more content…
§ 77q (a) (2)], which requires the company should have known that its statement was misleading. Neither the controller nor the board of directors noticed the irregularities on the financial statements for 2009 and 2010 until 2012. The company also violated Section 13(a) of the Exchange Act [15 U.S.C. § 78m (a)] and Rules 12b-20, 13a-1, and 13a-13 because it did not file with the Commission the accurate financial reports which fairly reflected its transactions and dispositions of its assets. (Securities and Exchange Commission v. DGSE Companies Inc. and I. John Benson,