(Full unedited article)
SEC looks for SpongeTech stain
By KAJA WHITEHOUSE
Last Updated: 9:24 PM, September 28, 2009
Posted: 1:28 AM, September 28, 2009
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SpongeTech, a New York sponge maker that advertises at Yankee Stadium and Citi Field, is being investigated by the Securities and Exchange Commission for possible securities law violations.
In an 8-K filed with the SEC late Friday, the maker of sponges with soap already in them said it "received a formal order of investigation" regarding possible securities laws violations on Sept. 18. Its officers and directors have also received subpoenas for documents, the filing said.
The formal investigation comes as the company struggles to file its financial report for the fiscal year ended in May because its former auditor, Drakeford and Drakeford, is no longer accredited with the Public Company Accounting Oversight Board.
Earlier this month, The Post reported that the SEC had flagged SpongeTech's financial statements for the last two years because of problems with the company's auditor.
SpongeTech has hired Robison Hill to audit the 2009 results and Deloitte and Touche to work on the company's 2010 financials.
Deloitte's work with SpongeTech "cannot commence" until the company files its 2009 annual report with the SEC, Deloitte spokesman Keith Lindenburg told The Post, contradicting previous statements by SpongeTech CEO Michael Metter that Deloitte will oversee Robison's work on the 2009 audit.
SpongeTech has not responded to requests for comment.
