CPA, firm agree to make payment of $320,000

Certified public accountant Michael Moore and his Las Vegas firm, Moore & Associates, agreed to pay $320,000 relating to allegations that they issued false audit reports on 300 public companies, the government announced Thursday.

The Securities and Exchange Commission on Thursday filed a federal lawsuit against Moore and his firm and also filed a settlement agreement with the defendants.

The settlement provides for disgorging $190,000, including prejudgment interest, and paying a $130,000 penalty. Moore and his firm also agreed to a permanent injunction against further securities violations and suspension from practicing before the commission as accountants.

Moore and his firm did not admit or deny the allegations in the SEC lawsuit.

The SEC accused the defendants of falsely reporting that they conducted audits according to standards of the Public Company Accounting Oversight Board.

"Even when there were red flags that a client's financial statements were materially misstated, the firm did not perform any meaningful audit procedures," Rosalind Tyson, director of the SEC's Los Angeles office, said in a statement.

The firm audited 300 clients, mainly shell companies or developmental state companies with stock trading on the Over the Counter Bulletin Board or the Pink Sheets, according to the SEC.

The companies that Moore audited include Ethos, a San Diego company that makes fuel reformulators; Tombstone Exploration Corp., a Tombstone, Ariz.-based company that explored mineral properties; Studio One Media; Biocoral; Centergistic Solutions; and Standard Drilling.

The civil complaint accused the defendants of fraud related to the sale of securities, failure to report likely illegal acts, accountant report violations and failing to retain records.