SEC investigation of EDS goes formal
The US Securities and Exchange Commission is now conducting a formal investigation into practices at Electronic Data Systems Corp, the company said late Friday. The news follows the revelation in early October that an "informal" SEC probe was underway.
EDS said in October that the SEC had "requested information regarding EDS' purchase and settlement of forward contracts related to its common stock and information regarding events leading up to its recent earnings guidance announcement."
Last autumn, the company's share price had dropped about 65% in just a few weeks, following an unexpected profit warning and a $225m cash payment as part of a stock buyback commitment. In October, EDS said it is cooperating with the probe and its "actions were proper." Last Friday EDS said it was cooperating with the SEC.
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