MIAMI (CN) - The SEC today charged Stiefel Laboratories, a subsidiary of GlaxoSmithKline, with defrauding employee shareholders of millions of dollars by buying back company stock at severely undervalued prices.
The SEC also sued Stiefel Labs CEO Charles Stiefel.
Stiefel was a family owned business in Coral Gables until Glaxo bought it 2 years ago. The SEC says the defendants cheated investors and employees by buying back shares on the cheap from November 2006 until April 2009.
"Stiefel Labs omitted key information that would have alerted employees that their stock was actually worth much more," the SEC said in a statement. "Instead, the information was confined to then-CEO Charles Stiefel and certain members of his family as well as some senior management. At the time, Stiefel Labs was the world's largest private manufacturer of dermatology products."
The SEC said the chicanery cost employee shareholders more than $10 million.