SEC Charges Compass Minerals With Disclosure Violations Resulting From "deficient Disclosure Process"

Toward the end of last month, the SEC announced settled charges against Compass Minerals International, Inc., for alleged disclosure violations that were "the consequence of a deficient disclosure process." In the Order, the SEC alleged that Compass misrepresented the impact of a technology upgrade at its Goderich mine—the world's largest underground salt mine—which the company had claimed would lead to cost savings, but actually led to increased costs and below-expectation results. Central to the case, however, was the purported failure of the company's disclosure controls that resulted in the misleading statements: "statements to investors were not reviewed by personnel who were sufficiently knowledgeable about both Compass's operations and its disclosure obligations." The company was also charged with failing to disclose the potential financial risks arising out of the company's contamination of a river in Brazil with excessive discharges of mercury, a failure