WASHINGTON, D.C. — In a recent settlement with the Federal Trade Commission (FTC), Ryan Cohen, founder of Chewy and current Chairman and CEO of GameStop Corp., has agreed to pay a civil penalty amounting to $985,320. The settlement resolves allegations that Cohen violated the Hart-Scott-Rodino (HSR) Act by failing to report his acquisition of over 562,000 shares of Wells Fargo & Company, which exceeded the regulatory filing thresholds.
The HSR Act mandates that individuals and companies report large acquisitions to the FTC and the Department of Justice (DOJ) to facilitate preliminary investigations before finalization. Cohen’s purchase, which was not exempt under the Investment-Only Exemption, necessitated an HSR filing that Cohen failed to make, thereby breaching the Act. The regulations are designed to allow federal agencies the opportunity to assess potential antitrust implications of significant transactions.
Cohen’s acquisition was intended to influence Wells Fargo’s business strategies, as indicated by his communications advocating for a board seat and suggestions for business improvements. Consequently, the FTC’s unanimous decision to accept the settlement exemplifies the agency’s efforts to enforce compliance with antitrust laws and ensuring transparency in securities transactions.
The Department of Justice filed the complaint and proposed order on behalf of the FTC in the U.S. District Court for the District of Columbia.
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