Another Liberal goes up in flames: 'Jay-Z' Slapped With SEC Court Order Over Securities Fraud Probe

https://www.sec.gov/litigation/litreleases/2018/lr24131.htm



The Securities and Exchange Commission has filed a subpoena enforcement action against Shawn Carter seeking an order directing him to comply with an investigative subpoena for his testimony.
According to the application and supporting papers, which were filed in federal court in the Southern District of New York, the SEC is investigating potential violations of the federal securities laws related to the financial reporting of New York-based Iconix Brand Group, Inc., which paid Carter more than $200 million to acquire intangible assets associated with Carter's Rocawear apparel brand. After the acquisition, Carter and Iconix maintained publicly-disclosed partnerships related to the Rocawear brand.
In March 2016, Iconix publicly announced a $169 million write down of Rocawear, and in March of this year, Iconix announced a further write down of $34 million. The SEC's application states that the Commission seeks Carter's testimony to inquire about, among other things, Carter's joint ventures with Iconix. The SEC initially issued a subpoena for Carter's testimony on November 16, 2017. On February 23, 2018, after Carter retained new counsel, the SEC issued a second subpoena for Carter's testimony. Carter failed to appear as required by the subpoenas and, through his counsel, Carter has declined to provide any additional dates on which he will agree to appear for investigative testimony.
As stated in the SEC's application, a subpoena enforcement action is appropriate where the information sought from the witness is relevant to the investigation. The application does not reflect a determination by the SEC or its staff that Carter has violated provisions of the federal securities laws at issue in the investigation.