Healthcare Services Group, Inc. Announces Conclusion of SEC Matter

Rhea-AI Summary

Healthcare Services Group, Inc. (NASDAQ:HCSG) has settled an investigation by the SEC regarding earnings per share calculations from 2014 to 2017, agreeing to pay a civil penalty of $6.0 million. The Company did not admit to any wrongdoing and emphasized its commitment to strong internal controls and compliance. Additionally, John C. Shea has been appointed as Chief Administrative Officer, effective September 1, 2021, while Andrew Brophy continues as Principal Accounting Officer. This resolution allows the Company to focus on its operational and growth strategies.

Positive

• Settlement with SEC allows focus on operational growth.
• No admission of wrongdoing, maintaining company's integrity.

Negative

• Civil penalty of $6.0 million impacts financial resources.

BENSALEM, Pa.--(BUSINESS WIRE)-- Healthcare Services Group, Inc. (NASDAQ:HCSG) (the “Company”) today announced it has entered into a settlement with the Securities and Exchange Commission (the “SEC”), resolving a previously reported investigation into the Company’s earnings per share calculations from 2014 to 2017. Under the terms of the settlement, the Company neither admitted nor denied the SEC's charges and agreed to pay a civil monetary penalty of $6.0 million.

“This settlement reflects our cooperation in working with the SEC to conclude this matter and enables us to continue with the execution of our operational and growth strategies,” said Ted Wahl, Chief Executive Officer. “The Company’s Board of Directors and management team remain committed to maintaining strong internal controls and adhering to best practices for compliance and corporate governance. We are pleased to put this matter behind us.”

The Company also announced that John C. Shea, who had served as the Company’s Chief Financial Officer since 2012, has been appointed Chief Administrative Officer and will transition to that role effective September 1, 2021. In his position as Chief Administrative Officer, Mr. Shea will continue to support the Company’s growth initiatives, operational imperative and capital allocation strategy. Andrew Brophy, a Certified Public Accountant, who has served as the Company’s SEC Reporting Manager from January 2018 to November 2020, Director of Accounting since November 2020, and Acting Principal Accounting Officer since February 2021, will continue as the Company’s Principal Accounting Officer.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210824005566/en/

Theodore Wahl

President and Chief Executive Officer



Matthew J. McKee

Chief Communications Officer



215-639-4274

investor-relations@hcsgcorp.com

Source: Healthcare Services Group, Inc.

FAQ

What is the SEC settlement amount for HCSG?

Healthcare Services Group, Inc. agreed to pay a civil monetary penalty of $6.0 million to settle the SEC investigation.

What years were involved in the SEC investigation of HCSG?

The SEC investigation involved earnings per share calculations from 2014 to 2017.

Who is the new Chief Administrative Officer of HCSG?

John C. Shea has been appointed as Chief Administrative Officer effective September 1, 2021.

What is the significance of HCSG's SEC settlement?

The settlement allows Healthcare Services Group to move forward with its operational and growth strategies without admitting wrongdoing.