Jay-Z Faces a Federal Investigation Over Suspicious Rocawear Transactions
- Author: Marlene Weaver May 04, 2018,
May 04, 2018, 9:41
The SEC is now investigating potential violations of the federal securities laws related to financial reporting of Iconix Brand Group, Inc., which licenses brands to apparel, footwear and apparel accessory retailers and manufacturers, according to documents filed in federal court. A Twitter user, referencing Jay-Z's third subpoena and hit track "99 Problems", tweeted Thursday, "Now, 100 problems".
Still, Carter could risk jail if he continues to try to evade the SEC subpoena, said David Chase, a former prosecutor for the agency.
Jay-Z has been ordered by a federal judge to explain why he shouldn't be ordered to testify in an ongoing investigation by the Securities and Exchange Commission. The SEC is now filing a subpoena enforcement action against Jay-Z for testimony to inquire about his joint venture with Iconix.
Carter received more than $200 million from Iconix in 2007 in a deal to acquire his Rocawear fashion brand.
The SEC, in its release, said after the acquisition, Carter and Iconix had maintained publicly disclosed partnerships relating to the Rocawear brand.
The nature of the SEC inquiry is not yet known as it's under seal, and Jay-Z's rep wasn't immediately aware of the demand for Jay's testimony. If Carter does not comply with the subpoena, he may be held in contempt, according to the order. "Mr. Carter is a private citizen who should not be involved in this matter", the statement said.
So Jay-Z Has Ignored Two Subpoenas Before - How Is That A Thing?
Iconix has yet to comment or respond to Investopedia's inquiry surrounding the subpoena.
Iconix shares were down 6.7 percent at 59 cents in early afternoon trades Thursday.