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SEC opens Rainbow Media probe

Cablevision cooperates with org, boosts legal defense assets

NEW YORK — The SEC has formally opened an investigation into the recently uncovered accounting improprieties at Cablevision’s Rainbow Media unit.

Cablevision willingly offered up its internal findings on the matter to regulators last month, having fired 14 staffers at its AMC and WE networks who it claimed were involved in a less-than-kosher reporting of expenses. Cablevision said it is cooperating fully with the SEC but cannot predict the outcome or duration of the investigation.

In a government filing late Thursday, Cablevision disclosed that it is now working with a government probe into the matter while it continues its own investigation into expenses accounting that “inappropriately accelerated into one year expenses that should properly have been accrued in the following year.”

In the last few weeks, Cablevision has boosted its legal defense assets to meet the SEC’s inquiring eyes. Last week, the company’s board of directors sought the assistance of former N.Y. Gov. Mario Cuomo’s Gotham-based law firm, Wilkie Farr & Gallagher. Former SEC official William McLucas of Washington D.C.-based Wilmer Cutler & Pickering has been named to lead the Cablevision team with the probe.

The Bethpage, N.Y.-based media group also is due to announce the appointment of recently departed AOL Time Warner deputy general counsel Jonathan Schwartz as its chief counsel.

The amount of money in question is not material enough for Cablevision to restate earnings, but that doesn’t stop the SEC from its obligation of delving more deeply into the matter.

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