IN THE MATTER OF RICHARD E. SELLERS, CPA AND LESTER REX
Richard E. Sellers and Lester Rex Andersen, CPAs, were charged by the SEC with knowingly causing their firm, Sellers & Andersen, LLC, to issue audit reports for five public companies after October 22, 2003, without registering with the PCAOB as required by Sarbanes-Oxley Act, leading to administrative proceedings seeking to bar them from practicing before the SEC.
Richard E. Sellers and Lester Rex Andersen, certified public accountants and partners of Sellers & Andersen, LLC, were accused by the SEC of willfully causing their firm to issue audit reports for five public companies after October 22, 2003, without registering with the Public Company Accounting Oversight Board (PCAOB), in violation of Section 102(a) of the Sarbanes-Oxley Act. The SEC alleged that they knowingly aided and abetted these violations and lacked the qualifications to represent clients before the Commission. Administrative and cease-and-desist proceedings were initiated under Sections 4C and 21C of the Securities Exchange Act and Rule 102(e), seeking censure and denial of their privilege to practice before the SEC, with no monetary penalties specified.
Richard E. Sellers and Lester Rex Andersen, certified public accountants and partners of Sellers & Andersen, LLC, were charged by the U.S. Securities and Exchange Commission with knowingly causing their firm to issue audit reports for five public companies after October 22, 2003, without registering with the Public Company Accounting Oversight Board (PCAOB), in direct violation of Section 102(a) of the Sarbanes-Oxley Act. The SEC alleged that both individuals were aware of the legal requirement for PCAOB registration but failed to ensure compliance, thereby willfully aiding and abetting their firm’s unlawful conduct. As a result, the SEC initiated administrative and cease-and-desist proceedings under Sections 4C and 21C of the Securities Exchange Act and Rule 102(e) of its Rules of Practice. The proceedings sought to determine whether Sellers and Andersen should be censured, denied the privilege of appearing or practicing before the Commission, or otherwise sanctioned for their professional misconduct. No monetary penalties were sought, as the focus was on regulatory compliance and professional accountability. The case was assigned to an Administrative Law Judge, who was directed to issue an initial decision within 300 days of service of the Order. The matter underscored the SEC’s enforcement priority on adherence to PCAOB registration requirements for firms auditing public companies.
Extracted insights
- agency the united states securities and exchange commission
- The United States Securities and Exchange Commission announced the issuance of an Order Instituting Administrative and Cease-and-Desist Proceedings
- Richard E. Sellers and Lester Rex Andersen caused their accounting firm, Sellers & Andersen, LLC to prepare and issue audit reports on the financial statements of five reporting companies
- Section 102(a) of the Sarbanes-Oxley Act of 2002 prohibits accounting firms not registered with the Board from preparing or issuing audit reports with respect to any issuer after that date
- Sellers and Andersen lacked the requisite qualifications to represent others
- Sellers and Andersen willfully aided and abetted and caused S&A’s violations of Section 102(a) of the Sarbanes-Oxley Act
- The Order institutes cease-and-desist proceedings against Sellers and Andersen pursuant to Section 21C of the Securities Exchange Act of 1934
- The Order directs the Administrative Law Judge to issue an initial decision in this matter no later than 300 days from the date of service of the Order
U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. SECURITIES EXCHANGE ACT OF 1934 Release No. 56436 / September 13, 2007 ACCOUNTING AND AUDITING ENFORCEMENT Release No. 2716 / September 13, 2007 ADMINISTRATIVE PROCEEDING File No. 3-12797 IN THE MATTER OF RICHARD E. SELLERS, CPA AND LESTER REX ANDERSEN, CPA The United States Securities and Exchange Commission (Commission) announced the issuance of an Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 4C and 21C of the Securities Exchange Act of 1934 and Rule 102(e) of the Commission’s Rules of Practice (Order) against Richard E. Sellers and Lester Rex Andersen. The Order alleges that Richard E. Sellers (Sellers) and Lester Rex Andersen (Andersen), both certified public accountants, knowingly caused their accounting firm, Sellers & Andersen, LLC (S&A), to prepare and issue audit reports on the financial statements of five reporting companies after October 22, 2003, without first registering S&A with the Public Company Accounting Oversight Board (Board). Section 102(a) of the Sarbanes- Oxley Act of 2002 (Sarbanes-Oxley Act) prohibits accounting firms not registered with the Board from preparing or issuing audit reports with respect to any issuer after that date. The Order alleges that, by their conduct, Sellers and Andersen lacked the requisite qualifications to represent others and willfully aided and abetted and caused S&A’s violations of Section 102(a) of the Sarbanes-Oxley Act. Based on the above, the Order institutes cease-and-desist proceedings against Sellers and Andersen pursuant to Section 21C of the Securities Exchange Act of 1934 (Exchange Act), as well as proceedings under Section 4C(a)(1) and (3) of the Exchange Act and Rules 102(e)(1)(i) and (iii) of the Commission’s Rules of Practice, to determine whether the allegations in the Order are true, whether cease-and-desist orders should be entered against Sellers and Andersen and whether they should be censured or denied the privilege of appearing or practicing before the Commission as accountants. The Order directs the Administrative Law Judge to issue an initial decision in this matter no later than 300 days from the date of service of the Order.
U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. SECURITIES EXCHANGE ACT OF 1934 Release No. 56436 / September 13, 2007 ACCOUNTING AND AUDITING ENFORCEMENT Release No. 2716 / September 13, 2007 ADMINISTRATIVE PROCEEDING File No. 3-12797 IN THE MATTER OF RICHARD E. SELLERS, CPA AND LESTER REX ANDERSEN, CPA The United States Securities and Exchange Commission (Commission) announced the issuance of an Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 4C and 21C of the Securities Exchange Act of 1934 and Rule 102(e) of the Commission’s Rules of Practice (Order) against Richard E. Sellers and Lester Rex Andersen. The Order alleges that Richard E. Sellers (Sellers) and Lester Rex Andersen (Andersen), both certified public accountants, knowingly caused their accounting firm, Sellers & Andersen, LLC (S&A), to prepare and issue audit reports on the financial statements of five reporting companies after October 22, 2003, without first registering S&A with the Public Company Accounting Oversight Board (Board). Section 102(a) of the Sarbanes- Oxley Act of 2002 (Sarbanes-Oxley Act) prohibits accounting firms not registered with the Board from preparing or issuing audit reports with respect to any issuer after that date. The Order alleges that, by their conduct, Sellers and Andersen lacked the requisite qualifications to represent others and willfully aided and abetted and caused S&A’s violations of Section 102(a) of the Sarbanes-Oxley Act. Based on the above, the Order institutes cease-and-desist proceedings against Sellers and Andersen pursuant to Section 21C of the Securities Exchange Act of 1934 (Exchange Act), as well as proceedings under Section 4C(a)(1) and (3) of the Exchange Act and Rules 102(e)(1)(i) and (iii) of the Commission’s Rules of Practice, to determine whether the allegations in the Order are true, whether cease-and-desist orders should be entered against Sellers and Andersen and whether they should be censured or denied the privilege of appearing or practicing before the Commission as accountants. The Order directs the Administrative Law Judge to issue an initial decision in this matter no later than 300 days from the date of service of the Order.