"We allege that, for years, SolarWinds and Brown ignored repeated red flags about SolarWinds' cyber risks, which were well known throughout the company," SEC enforcement director Gurbir Grewal said in a press release.
SolarWinds went public in 2018, and made only "generic" disclosures about cybersecurity risk in both its prospectus and in continued filings, the complaint said.
However, the SEC alleged that SolarWinds and Brown knew that the company's cybersecurity practices were weak, pointing to an internal presentation from Brown that was made the same month SolarWinds went public.
It appears to be one of the first times the SEC has alleged a company misled and defrauded investors over cybersecurity risks.
In reality, Brown knew that the company was not following those best practices, the SEC alleged.
Persons:
SolarWinds, Tim Brown, Brown, Gurbir Grewal, weren't, Solarwinds, Kevin Thompson, Sudhakar Ramakrishna, Mr, Alec Koch
Organizations:
SolarWinds Corp, New York Stock Exchange, Securities and Exchange Commission, SEC, software, Orion, unf, Regulators, MGM Resorts, CNBC
Locations:
New York, U.S, Russian, Clorox, SolarWinds