“We are pleased to have reached resolution with the U.S. Attorney’s Office, and the Securities and Exchange Commission, and are committed to our customers, compliance, transparency, and accountability across our organization and from our vendors. Lumber Liquidators has undergone a complete transformation in recent years and today is a new company led by an entirely new management team. We continue focusing on providing quality products, services and experiences for our valued customers and stakeholders.”
The Company entered into a deferred prosecution agreement with the U.S. Attorney’s Office for the Eastern District of Virginia and the Department of Justice (DOJ) to resolve its charge of securities fraud in connection with the Company’s Form 8-K filing in March 2015. The agreement with the DOJ stated the charges are deferred and will be dismissed after three years provided that the Company meets certain obligations, many of which are already implemented.
The Company entered into a settlement of an administrative proceeding with the Securities and Exchange Commission (SEC) regarding violations of Sections 10(b) and 13(a) of the Exchange Act and applicable rules. Notably, neither the DOJ nor the SEC made any findings regarding the safety or quality of the Company’s laminate flooring previously sourced from China.
As a result, Lumber Liquidators has agreed to pay a fine in the amount of $19.1 million, and restitution of $13.9 million, of which up to $6.1 million will be paid to the SEC in disgorgement and prejudgment interest. As part of its relevant considerations, the DOJ noted that Lumber Liquidators’ “employees involved in wrongdoing either were terminated or resigned from the Company, and the Company replaced its executive management team with experienced executives who have displayed a commitment to building an ethical corporate culture.”
In the lead-up to these agreements, Lumber Liquidators has incorporated extensive remedial measures that include the implementation and enforcement of a comprehensive compliance, ethics, and reporting program, as well as training and guidance on relevant policies and procedures.
These resolutions are an acknowledgment of our good faith and relentless efforts to transform our company and demonstrate our commitment to our customers, compliance, transparency and accountability across our organization and from our vendors.
Lumber Liquidators has invested significantly in improvements to our compliance policies and procedures and related remediation efforts, and undergone a complete management transformation since the spring of 2015.
The U.S. Consumer Product Safety Commission closed its investigation of Lumber Liquidators’ Chinese-sourced laminate products without issuing a product recall. We believe this is validation that the formaldehyde levels met requirements and demonstrates the products were safe.
Still have questions? Contact: LLNewsRoom@lumberliquidators.com
From inspiration to installation, our passion is to make beautiful flooring possible and easy for all.
Lumber Liquidators is committed to selling high quality safe products produced in ethical environments to our customers. We make sure that our vendor’s factories and how our products are made meet all laws and mandatory safety standards before any product is shipped to us. To support this commitment, we use rigorous tools and processes to assess our products at every stage of production. By doing this, we ensure that through audits and testing, our vendors and our products meet and / or exceed the highest standards. If we learn about a problem with one of our products, we investigate and, when necessary, quickly remove it from our stores, distribution centers, and Lumberliquidators.com.
Lumber Liquidators is investing more than ever to ensure the products we offer will exceed your expectations and the high standards we set for ourselves. In support of healthier home environments, we have voluntarily required all of our vinyl floors to be made with materials that meet the heavy metals and chemical requirements required to be considered safe enough to be used in children’s toys. Further, all of our wood flooring is made to the most rigorous applicable emission standards.
Our flooring vendors are required to partner with Underwriter’s Laboratories or SCS Global Services to meet stringent GREENGUARD Gold or FloorScore certification standards for indoor air quality. When you shop with us, you can have peace of mind knowing these floors have met some of the world’s most demanding industry standards for low chemical emissions. Additionally, all products that carry the GREENGUARD Gold or FloorScore certification are eligible for various sustainable building credits, including Leadership in Energy and Environmental Design (LEED) and the WELL Building Standard. Learn more about GREENGUARD Gold at: http://greenguard.org/en/index.aspx.
Nothing is more important to our business than building and maintaining trust with our customers. For our company, integrity is at the very core of our business and is founded on our steadfast commitment to the following guiding principles: Do the Right Thing, Teamwork, Responsible Sourcing and Safe Products. Each of us at Lumber Liquidators plays an important role in modeling these guiding principles each day through our actions and ongoing commitment to act with integrity.
In every activity, relationship and interaction, our dedication and commitment to these principles helps maintain Lumber Liquidators’ reputation as an ethical and responsible corporate citizen now and into the future.
We are committed to doing the right thing all the time. We must always act with integrity and exercise sound and ethical judgment in everything we do.
We are committed to working in partnership and with mutual respect for each other, our customers, and our suppliers. Working together as a team enables us to advance the Company and meet our goals and objectives.
We are committed to sourcing our products in a responsible and lawful manner.
We are committed to providing high quality products that are safe for use by our customers.
Giving back to our communities where we live and work is something we believe is good for our business and simply the right thing to do. We encourage associates to volunteer their time and talents to support their local communities, charitable causes and other non-profit organizations that align with their interests and beliefs.
At Lumber Liquidators, we’re committed to making a lasting difference in the communities in which we operate.
We call our community support program “Lay It Forward” and, since 2007, Lumber Liquidators has donated more than 300,000 square feet of flooring to nonprofit organizations, schools, arts facilities, community groups and more.
Whether it’s the responsible harvesting of hardwoods throughout the world, donating time or money to local charitable organizations, or creating jobs in communities around the country and around the world, we are contributing to a better future.