Vince McMahon, former CEO of World Wrestling Entertainment (WWE), has reached a settlement with the U.S. Securities and Exchange Commission (SEC) regarding charges of failing to disclose $10.5 million in settlement agreements with two women. The agreements were made to prevent them from revealing potential claims against McMahon and the company.
Allegations and Agreements
The SEC investigation revealed:
- A 2019 agreement in which McMahon paid $3 million to a former employee in exchange for her silence and release of claims against WWE and McMahon.
- A 2022 agreement obligating McMahon to pay $7.5 million to a former independent contractor under similar terms.
The agreements were not disclosed to WWE’s board, legal department, or auditors, leading to material misstatements in the company’s 2018 and 2021 financial statements. As a result, WWE overstated its 2018 net income by 8% and its 2021 net income by 1.7%.
SEC Penalties and Reimbursements
The SEC determined McMahon circumvented WWE’s internal accounting controls. Without admitting or denying the findings, McMahon agreed to:
- Cease-and-desist from violating SEC provisions.
- Pay a $400,000 civil penalty.
- Reimburse WWE approximately $1.3 million.
Once aware of the undisclosed agreements, WWE restated its financial statements in August 2022 to reflect the payments. Thomas P. Smith Jr., associate regional director of the SEC’s New York office, emphasized that executives cannot withhold material agreements from their companies’ control functions and auditors.
McMahon stepped down as WWE’s CEO in 2022 amid allegations of misconduct, later resigning as executive chairman in January 2024 following a federal lawsuit accusing him and another executive of sexual misconduct. Despite denying any wrongdoing, McMahon’s resignation marked the end of his decades-long tenure as WWE’s most prominent leader.
Under McMahon’s leadership, WWE evolved from small wrestling venues to hosting matches in professional sports stadiums, with events broadcast globally. The company’s flagship show, Raw, debuted on Netflix earlier this week, achieving 4.9 million global views and reaching 2.6 million U.S. households.
This settlement brings closure to one chapter of McMahon’s controversial legacy, as WWE continues to expand its global footprint under new leadership.