Chemours says internal review finds disclosure violations by top executives

Investing.com-- Chemicals maker Chemours Co (NYSE:CC) said on Wednesday that an internal review found that its  top three executives, who were placed on administrative leave last week, had violated the firm’s code of ethics, particularly regarding financial disclosures.

The firm, which had placed its CFO, CEO and Financial Controller on leave in late-February, said in a press release that the three executives worked to delay payments to certain vendors that were due in the fourth quarter of 2023 to the first quarter of 2024. They had also attempted to accelerate the collection of certain receivables into Q4 2023, which were only due in Q1 2024. 

“The Audit Committee found that these individuals engaged in these efforts in part to meet free cash flow targets that the Company had communicated publicly, and which also would be part of a key metric for determining incentive compensation applicable to executive officers,” Chemours said in a press release. 

Chemours said that it appeared likely that similar actions were undertaken in Q4 2022.  

The firm said it was still working to determine the impact on its net cash flow measures by the executives’ actions, but that the findings of the review did not affect the preliminary results for 2023 it had released in February. 

Chemours said it was now evaluating one or more potential material weaknesses in its internal controls over financial reporting as of December 31, 2023, as well as controls over its ethics hotline. 

The firm did not provide a date for the release of its Q4 results, which it had delayed in February. 

Shares of the firm had plummeted to over three-year lows after it suspended its top brass in February.

Chemour's CEO, CFO and Financial Controller could not be immediately reached for a comment.