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CBS and Les Moonves to pay $30.5 million for insider trading, harassment claims

NEW YORK (AP) — CBS and its former chairman, Leslie Moonves, will pay $30.5 million as part of a settlement with the New York attorney general’s office to compensate network shareholders, as part of a an investigation into insider trading and for covering up sexual assault allegations against Moonves.

The streaming giant is required to pay $22 million to shareholders and another $6 million for sexual harassment and assault programs. Moonves will have to pay $2.5 million, all of which will benefit shareholders who, according to the New York attorney general, were made aware of the allegations because network executives withheld the information.

At least one of those executives — one of the few privy to an internal investigation — sold millions of dollars worth of stock before the allegations against Moonves became public.

“As a publicly traded company, CBS failed in its most basic duty to be honest and transparent with the public and investors. After attempting to bury the truth to protect their fortunes, CBS and Leslie Moonves are paying today millions of dollars for their wrongdoings,” Attorney General Letitia James said in a statement, calling attempts to mislead investors “reprehensible.”

A spokesperson for Paramount Global, which owns CBS, said it was “pleased to resolve this matter regarding the events of 2018 with the New York Attorney General’s office, without any admission of liability or wrongdoing.” , adding that “the matter involved alleged misconduct by CBS’ former CEO, who was terminated for cause in 2018, and has no connection to the current company.

Moonves resigned from CBS on September 9, 2018.

In a document outlining the findings of its investigation, the attorney general’s office also described an alleged scheme by a Los Angeles police captain to try to cover up the allegations against Moonves.

The police captain, who was not named in the report, told CBS that a woman had filed a complaint against Moonves in the Hollywood Division of the Los Angeles Police Department.

The captain then personally met with Moonves and another CBS executive and provided them with confidential information about the investigation. The captain also ordered officers investigating the complaint to “recommend” that the woman not report her allegations to the media, according to the attorney general’s office.

When the allegations finally became public anyway and Moonves resigned, the captain sent a note to a CBS contact saying, “We’ve worked so hard to try to avoid this day.”

He also wrote a note to Moonves saying, “I am deeply sorry this happened. I will always support you, support you and pledge my allegiance to you.

The attorney general’s office said it discovered text messages between the police captain, CBS executives and Moonves that showed efforts to keep the complaint from becoming public.

Failure to disclose such information to shareholders, officials said, constituted insider trading and violated state laws designed to protect investors.

CBS is also required, under the agreement with the Attorney General’s office, to reform its human resources practices regarding sexual harassment.



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