MINNEAPOLIS Buca Inc. has a settled a lawsuit with the Securities and Exchange Commission that alleged violations of federal securities laws, the company said Friday.
The lawsuit relates to the SEC's investigation of the accounting practices of former Buca officials, including ex-chief executive Joseph P. Micatrotto, who was sentenced to prison earlier this year after pleading guilty to federal fraud charges.
Under Friday’s settlement, Buca neither admits nor denies wrongdoing and is prohibited from any future violations of securities laws, according to a company statement. No fine was levied, the statement also noted.
"We have cooperated fully with the SEC, and we believe that the investments we made in systems, processes and infrastructure over the past several years have allowed us to reach this settlement, which will have no additional financial impact [on] the company," Wallace B. Doolin, Buca's chairman and CEO, said in the statement.
Buca, parent of the Buca di Beppo chain, fired Micatrotto in 2004 after an internal audit revealed that he had used company funds for personal use, including airline tickets, family wedding expenses, home improvements and the purchase of a villa in Italy. Micatrotto's guilty plea resulted in one of the first convictions under the federal Sarbanes-Oxley Act, which was passed after the Enron accounting scandal.
Two other former Buca executives, former chief financial officer Greg Gadel and former controller John Motschenbacher, also were convicted and sentenced for misappropriating company funds.
Buca said that since Doolin and his management team took over in late 2004, the company has made several changes to improve its accounting processes and procedures. The Minneapolis-based company currently owns and operates 91 family-style Italian restaurants in 25 states and the District of Columbia.
Buca's stock fell 3.11 percent on Friday to close at $1.87.