- The United States Department of Justice & the Securities & Exchange Commission announced the settlement.
- The ruling comes four years after the company was allegedly caught selling laminate flooring that contained high levels of formaldehyde.
Lumber Liquidators Inc. (Lumber), a Virginia-based hardwood flooring retail company, has reportedly been ordered to pay a criminal penalty of $33 million to settle federal charges that claimed it misled investors by downplaying the safety risks of laminate flooring it imported from China and where sold to customers in the U.S.
Reports cite, the settlement was announced by the United States Department of Justice & the U.S. Securities & Exchange Commission and comes four years after the company was allegedly caught selling laminate flooring that contained high levels of an illegal carcinogen, formaldehyde.
According to a report by the New York Post, the Justice Department, in a 53-page-long deferred prosecution agreement, claimed that the retail company was aware that the laminate products imported from China had failed to clear tests they were subjected to when it denied a report by CBS news that the same laminate products failed to pass the California emission standards test.
The U.S. Justice Department, under the deferred prosecution agreement, has agreed to not prosecute the company for the securities fraud they committed if Lumber upgrades oversight & fully cooperates with its ongoing investigation for three years.
The Director of the New York Regional Office at the Securities & Exchange Commission, Marc Berger stated that the relief that was attained, along with the imposed criminal penalty by the Justice Department, ensures that Lumber Liquidators would forfeit all & any profits they made & pay heavily for the false allegations it made to the market.
According to reports, the amount to be paid by Lumber represents the net profits it made through the sale of 100% of its laminate floorings imported from China from January to May in 2015.