Former accountant for the Walt Disney Company now SEC whistleblower says Disney inflated its revenue by billions according to Marketwatch

Sandra Kuba, a former accountant at the Walt Disney Company filed a Securities and Exchange Commission whistleblower report which alleges that the company has falsely inflated and overstated its revenue for years.  Ms. Kuba worked at the company for 18 years in their revenue-operations department. She detailed that the parks-and-resorts business overstated their revenue by billions of dollars.  She estimated the company’s 2008-2009 annual revenue could be overstated as much as $6 billion.

Marketwatch reports that their review of her filings shows that employees allegedly boosted revenue by recording fictitious revenue for complimentary golf rounds or for free guest promotions and also recording revenue for $500 gift cards at their face value even when guests paid a discounted rate of $395. Kuba also says that employees sometimes recorded revenue twice for gift cards, both when guests bought the gift card and when it was used at a resort. Sometimes, revenue was recorded even though a gift card was given to a guest for free following a customer complaint, for instance, according to the whistleblower’s allegations.

Kuba told MarketWatch she first reported the alleged revenue-recognition issues to management in 2013. She said that no one responded to her at that time. She said that she escalated her concerns to a more senior executive in 2016 and that Disney’s corporate audit group contacted her once in November 2016 but never followed up.

Kuba said she has spoken and met with the SEC multiple times.

Under the Securities & Exchange Commission whistleblower program, Ms. Kuba could be entitled to as much as  30 percent of whatever the government might recover from Disney, if it is successful. Under the new whistleblower program, the SEC is authorized to make monetary awards to whistleblowers who voluntarily provide original information that leads to successful enforcement actions resulting in monetary sanctions over $1,000,000. Individuals who report wrongdoing confidentially and receive a reward. SEC whistleblowers also are entitled to job protection. in fiscal year 2018 the SEC program awarded $168 million to 13 individuals.  An individual whistleblower may be a resident of the US or reside outside the US. SEC whistleblower claims that have been filed with the SEC include allegations of money laundering, accounting fraud, mispricing of stock and violations of laws prohibiting foreign bribes by US companies or companies doing business here.