The Los Angeles regional office of Securities and Exchange Commission, which was investigating Charney’s American Apparel Inc. on several fronts, told the firm Monday that it did not intend to recommend any enforcement action against the company.
Investors drove shares of the firm up 15.6 percent to $1.
The SEC issued American Apparel a subpoena in August 2010 for documents related to a change in the company’s accountant as well as its “financial reporting and internal controls.”
In May last year, American Apparel was subpoenaed again as the financial regulatory body sought documents related to a complaint filed by a former employee with the Occupational Safety and Health Administration related to the firm’s accounting of foreign currency transactions and transfer pricing.
American Apparel said it cooperated fully with the subpoenas and investigation, which was completed.
The action removes a burden from the company, which Charney, as chairman and chief executive officer, is working to turn around financially.