McMahon, WWE's former executive chairman and CEO, reached the agreement related to charges from the Securities and Exchange Commission, the federal agency said in a news release on Friday, Jan. 10. The SEC said McMahon concealed the "hush money" payments, creating discrepancies in WWE's financial reports.
McMahon agreed to pay a $400,000 civil penalty and reimburse $1,330,915.90 to WWE. The settlement also said McMahon didn't admit to the SEC's findings or deny the accusations.
The 79-year-old also agreed to cease-and-desist from violating the settlement's provisions.
"Company executives cannot enter into material agreements on behalf of the company they serve and withhold that information from the company’s control functions and auditor," said Thomas Smith Jr., associate regional director for the SEC's New York Regional Office.
McMahon released a statement on social media about the settlement.
"The case is closed," said McMahon. "Today ends nearly three years of investigation by different governmental agencies. There has been a great deal of speculation about what exactly the government was investigating and what the outcome would be. As today's resolution shows, much of that speculation was misguided and misleading.
"In the end, there was never anything more to this than minor accounting errors with regard to some personal payments that I made several years ago while I was CEO of WWE. I'm thrilled that I can now put all this behind me."
The SEC said McMahon paid $3 million to a former WWE employee and $7.5 million to a former WWE independent contractor. The women agreed to not disclose their relationship or allegations against McMahon, as well as releasing him and WWE from potential claims.
McMahon was also accused of withholding the nondisclosure agreements from WWE's internal accountants. The company headquartered in Stamford, Connecticut, overstated its net income by eight percent in 2018 and by 1.7 percent in 2021.
McMahon "voluntarily stepped back" from his roles with WWE in June 2022 amid a board investigation into misconduct allegations. The Wall Street Journal reported McMahon paid $12 million over 16 years to settle claims of infidelity and other sexual misconduct.
WWE revised its financial statements to include McMahon's "hush money" payments in August 2022. McMahon was unanimously reelected as executive chairman of WWE's board of directors in January 2023.
In April 2023, McMahon was also named executive director of TKO Group Holdings, a newly merged company between WWE and the owner of promotions for the Ultimate Fighting Championship (UFC). McMahon resigned from both positions in January 2024 after a former WWE employee accused him of sex trafficking and abuse, NBC News reported.
The Wall Street Journal also reported in February 2024 that federal prosecutors opened a criminal investigation into the sex trafficking accusations, which McMahon has denied.
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