SEC charges View Inc. with failing to disclose $28M liability

The Securities and Exchange Commission announced settled charges against View Inc., for failing to disclose $28M in projected warranty-related liabilities to address a particular defect in its windows. The agency said, “The SEC decided not to impose civil penalties against View because the company self-reported the misconduct to the SEC, promptly undertook remedial measures, and cooperated with the staff’s investigation. The SEC also announced charges against View’s former CFO, Vidul Prakash, for his failure to ensure that the warranty-related liabilities were disclosed. According to the SEC order, in a series of reports and statements filed with the SEC from December 2020 to May 2021, View disclosed warranty liabilities of $22M to $25M, consisting largely of projected costs to manufacture replacements for certain defective windows. However, View failed to include in its disclosures the additional cost to ship and install the new windows, which View had decided to cover and which therefore should have been disclosed under generally accepted accounting principles in the United States. Including those costs, View should have disclosed total warranty liabilities of $48-$53M. As a result, the SEC order finds, View materially misstated its warranty liability for fiscal years 2019 and 2020 and the first quarter of 2021…The SEC’s order finds that View violated negligence-based antifraud, proxy disclosure, reporting, books and records, internal accounting controls, and disclosure controls provisions of the federal securities laws. Without admitting or denying the SEC’s findings, View agreed to cease and desist from future violations of the charged securities laws.”