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A federal district court has permanently barred two former corporate officers of a North Carolina-based hygiene and sanitation company from serving as officers or directors of public companies.

The Securities and Exchange Commission charged the two officers of Swisher Hygiene, Inc., Michael J. Kipp, Swisher’s former CFO, and Joanne K. Viard, Swisher’s former Director of External Reporting, in 2016 with fraud for participating in an earnings management scheme. The SEC’s complaint alleged that, during the second through fourth quarters of 2011, Kipp took advantage of Swisher’s ineffective internal controls and directed his accounting group to change various acquisition-related reserves and expenses to increase earnings to predetermined targets. The complaint alleged that Viard identified potential acquisition-related entries that could be reclassified to meet earnings targets, and made various adjusting entries in Swisher’s accounting records without adequate justification or support. In a parallel action, Kipp and Viard were charged criminally and were sentenced to 54 and 24 months imprisonment, respectively.

The final judgment, entered on February 11, 2019 by the Honorable Max O. Cogburn, Jr. of the U.S. District Court for the Western District of North Carolina, bars Kipp and Viard from serving as officers or directors of public companies and permanently enjoins Kipp and Viard from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) and Rule 10b-5 thereunder, the disclosure provisions of Section 13(a) of the Exchange Act and Rules 12b-20, 13a-11, and 13a-13 thereunder, the recordkeeping and internal controls provisions of Sections 13(b)(2)(A) and (B) and (b)(5) of the Exchange Act and Rule 13b2-1 thereunder, and permanently enjoins Kipp from violating the lying to auditors prohibition of Rule 13b2-2 under the Exchange Act and the certification provision of Rule 13a-14 under the Exchange Act. Kipp and Viard consented to the entry of the final judgments.

The court’s entry of the judgments against Kipp and Viard resolves the SEC’s litigation.