Provectus Biopharm Settles SEC Suit Over Executive Perks

Tennessee-based Provectus Biopharmaceuticals Inc. Dec. 12 settled SEC allegations it failed properly to report as compensation millions of dollars in perks provided to its then-top executives.

Provectus didn’t have adequate controls over the reporting and disclosure of travel and entertainment expenses submitted by its executives, the Securities and Exchange Commission said.

“The SEC’s settlement with Provectus — which does not include any penalty — takes into account the proactive remediation and cooperation by the company’s new leadership,” co-Enforcement Director Steven Peikin said. “Provectus fired wrongdoers, took other steps to remedy its controls, and provided SEC staff with critical information regarding its former executives’ expense reimbursement abuses.”

At the same time, Peter Culpepper, the concern’s former chief financial officer, settled allegation he obtained almost $200,000 in unauthorized, undisclosed benefits. Culpepper will pay $152,376 in disgorgement and interest, plus a $90,535 civil penalty, and will be suspended from appearing before the SEC as an accountant for at least three years.

Former Provectus chief executive officer H. Craig Dees, who is representing himself, was sued in the U.S. District Court for the Eastern District of Tennessee for allegedly submitting “little, no, or fabricated” expense reports and other documents to obtain $3.2 million in cash advances and reimbursements for business travel he never took.

“Instead, he concealed the perks and used cash advances to pay for personal expenses such as cosmetic surgery for female friends, restaurant tips, and personal travel,” the SEC said. It is asking the court to order disgorgement plus prejudgment interest, civil money penalties, an officer/director bar, and an injunction against future violations.

The cases are In re Provectus Biopharmaceuticals Inc. , S.E.C., Admin. Proc. File No. 3-18306, 12/12/17 ; In re Culpepper , S.E.C., Admin. Proc. File No. 3-18308, 12/12/17 ; SEC v. Dees , E.D. Tenn., 3:17-cv-00532, 12/12/17

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