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App Annie ordered to pay 10 million euros to solve fraud with the SEC

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App Annie, a company that collects and sells information about the performance of mobile apps, has agreed to pay €10 million to close a securities fraud investigation.

According to the SEC, App Annie used the sensitive information of several app companies to generate its statistical models of app performance. App Annie told companies that the data they provided would be aggregated and anonymized, and would not disclose to third parties. Between late 2014 and mid-2018, App Annie and her former CEO Bertrand Schmitt used the data that wasn’t aggregated or anonymous to make their estimates more valuable in selling the trading company.

The SEC says App Annie and Schmitt were well aware that trading company clients were using their information to make investment decisions and misrepresented the way they generated their estimates, saying App Annie had effective internal controls for prevent sensitive data from being misused.

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Gurbir Grewal, director of SEC oversight, said App Annie and the former CEO “lied to companies about how their sensitive data was being used ​​and then didn’t just sell the manipulated estimates to their customers. as well as encouraging them to negotiate estimates with them.

The SEC noted that the information App Annie collected is called “alternative data” by trading companies, as it is not information found in a company’s financial statements or other traditional data sources.

As part of this settlement, App Annie has neither admitted nor denied the SEC’s allegations. Schmitt will pay a fine of €300,000 and is barred from serving as an executive or director of a publicly traded company for three years.

“I deeply regret that App Annie’s proceedings before mid-2018 resulted in an investigation with the SEC,” wrote Schmitt. He also said that the company “didn’t actually disclose any confidential customer information or MNPI outside the company. The SEC has made no such claim, the allegations that we may have misrepresented the trading company’s customers the adequacy of our controls over some of the confidential data we use in our estimates is still very disturbing to me as co-founder and former CEO of company. ”App Annie

Source: appannie

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