UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 46988 / December 12, 2002

Accounting and Auditing Enforcement
Release No. 1689 / December 12, 2002

Administrative Proceeding
File No. 3-10970

In the Matter of SUSAN MOORE, Respondent.

: : : : :

ORDER INSTITUTING PROCEEDINGS PURSUANT TO SECTION 21C OF THE SECURITIES EXCHANGE ACT OF 1934, MAKING FINDINGS AND IMPOSING A CEASE-AND-DESIST ORDER

I.

The Securities and Exchange Commission ("Commission") deems it appropriate that public administrative proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") to determine whether Susan Moore caused violations of Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder.¹

II.

In anticipation of the institution of these administrative proceedings, Moore has submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purposes of these proceedings and any other proceedings brought by or on behalf of the Commission or to which the Commission is a party, and without admitting or denying the Commission's findings contained herein, except that she admits the jurisdiction of the Commission over her and over the subject matter of these proceedings, Moore consents to the entry of this Order Instituting Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings and Imposing a Cease-and-Desist Order ("Order").

III.

FACTS

On the basis of this Order and the Respondent's Offer of Settlement, the Commission finds that:²

A. Respondent

Susan Moore, age 41, joined Safety-Kleen Corp. ("Safety-Kleen") as Financial Reporting Manager in February 1998. In October 1999, she was promoted to Vice President of Accounting. Moore remained with the company during an investigation by a special committee of Safety-Kleen's Board of Directors and was terminated in October 2001. Moore is a certified public accountant licensed in South Carolina.

B. Related Entity

Safety-Kleen is a Delaware corporation with headquarters in Columbia, South Carolina. It is one of the nation's leading providers of industrial waste collection and disposal services. Safety-Kleen's common stock is registered pursuant to Section 12(b) of the Exchange Act and was listed for trading on the New York Stock Exchange until it was delisted on June 12, 2000. On June 9, 2000, Safety-Kleen and 73 of its wholly-owned domestic subsidiaries filed a voluntary petition for reorganization under Chapter 11 of the Bankruptcy Code.

C. Summary

From at least November 1998 through March 2000, several of Safety-Kleen's former senior executives engaged in a massive accounting fraud by materially overstating the company's revenue and earnings in periodic reports filed with the Commission and in press releases issued by the company. They carried out the scheme primarily by making inappropriate quarterly accounting adjustments for the purpose of meeting Wall Street earnings expectations.

On March 6, 2000, after Safety-Kleen's Board of Directors had received information concerning possible accounting irregularities, the company announced that it had initiated an internal investigation of its previously reported financial results and certain of its accounting policies. The company also announced that its Chief Executive Officer and Chief Financial Officer had been placed on administrative leave pending the outcome of the internal investigation. On July 9, 2001, Safety-Kleen filed restated financial statements for fiscal years 1997, 1998 and 1999. The company's restatement reduced net income over the three-year period by $534 million. Approximately $312 million, or 58%, of the restated net income was in fiscal 1999. Also on July 9, 2001, the company filed financial statements for fiscal 2000 reflecting a net loss of $833 million.

As Safety-Kleen's Financial Reporting Manager, Moore received financial data at the end of each quarter, and then prepared the company's financial statements for filing with the Commission. As directed by her superiors, she participated in the preparation of financial statements that, in the exercise of reasonable care, she should have known were not in conformity with generally accepted accounting principles ("GAAP"). This conduct caused Safety-Kleen to violate Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder.

D. The Fraudulent Accounting Scheme

Each month, as financial data was reported to Safety-Kleen's headquarters from its field offices, there were several preliminary closings of the company's general ledger. This process usually took up to ten days following month end. At the end of each quarter, Safety-Kleen's Chief Financial Officer (Paul R. Humphreys), Controller (William D. Ridings) and Vice President of Accounting (Thomas W. Ritter, Jr.) met to discuss the results of operations. Typically, Humphreys told Ridings and Ritter what the targeted earnings amount was, and then they jointly discussed potential accounting adjustments to help them achieve the target. Moore did not participate in those meetings. Although the company had always made legitimate quarterly adjusting entries in preparing its financial statements, the magnitude and nature of the adjustments changed dramatically during fiscal 1999. As time went on, the discrepancy between the company's projected results and the actual results increased, and several improper adjustments were made each quarter to reach the earnings targets. Humphreys, Ridings and Ritter each recorded, or directed others to record, accounting adjustments that were not in conformity with GAAP. Moore was one of several Safety-Kleen employees who received instructions to make some of those adjustments.

As the table below reflects, Safety-Kleen's quarterly earnings were significantly increased as a result of accounting adjustments.

	EARNINGS BEFORE ADJUSTMENTS (IN MILLIONS)	EARNINGS AS REPORTED AFTER ADJUSTMENTS (IN MILLIONS)	TOTAL ADJUSTMENTS (IN MILLIONS)	%
1st Quarter FY 1999	$90.9	$127.5	$36.6	40.3
2nd Quarter FY 1999	$76.7	$107.6	$30.9	40.3
3rd Quarter FY 1999	$47.9	$123.4	$75.5	157.6
4th Quarter FY 1999	$57.3	$110.4	$53.1	92.7
FY 2000	$47.0	$116.8	$69.8	148.5
Total	$319.8	$585.7	$265.9	83.1

E. Moore's Role in Safety-Kleen's Violations

As Safety-Kleen's Financial Reporting Manager, Moore shared responsibility for preparing the company's financial statements. She worked closely with the other financial managers in the company to compile Safety-Kleen's financial statements and public filings. Beginning in fiscal 1999, Moore, in the exercise of reasonable care, should have known that many of the company's accounting adjustments were not in conformity with GAAP. Nevertheless, she failed to correct the improper accounting and continued to improperly record certain other adjustments when directed to do so. For example, at the close of the third quarter of fiscal 1999, Humphreys instructed Moore to make a worksheet adjustment to improperly defer $5.2 million of expenses that had been incurred during that quarter. Moore made this adjustment the day before a Board of Directors meeting and gave the updated financial statements to Humphreys. Moore was never provided with any documentation to support the adjustment. In addition to inflating Safety-Kleen's earnings for the quarter by a net of approximately $3.25 million, this adjustment had a material impact on the company's earnings-per-share, increasing it from $.27 to $.30.

Moore was also responsible for improperly recording $6.3 million of revenue at the end of fiscal 1999. At Humphreys' direction, Moore made the adjustment without any supporting documentation. Moore, in the exercise of reasonable care, should have known that other employees had already booked this revenue. Moore made several other non-GAAP adjustments to Safety-Kleen's financial statements in other reporting periods at the direction of Humphreys that, in the exercise of reasonable care, she should have known were improper.

By following Humphreys' instructions, Moore assisted Safety-Kleen in preparing financial statements that were not consistent with GAAP, in maintaining false and misleading books and records, and in failing to maintain a system of internal accounting controls sufficient to prevent the recording of improper accounting adjustments.

IV.

LEGAL DISCUSSION

A. Safety-Kleen Violated the Reporting Provisions of the Exchange Act

Section 13(a) of the Exchange Act requires that issuers with securities registered pursuant to Section 12 of the Exchange Act file such information and documents as the Commission shall prescribe by its rules and regulations. Rules 13a-1 and 13a-13 thereunder require issuers to file annual and quarterly reports, respectively. Rule 12b-20 thereunder requires that these periodic reports contain such further information as is necessary to make the required statements, in the light of the circumstances under which they are made, not misleading. The filing of a periodic report containing materially false or misleading information constitutes a violation of these provisions. SEC v. Savoy Indus., Inc., 587 F.2d 1149, 1165 (D.C. Cir. 1978), cert. denied, 440 U.S. 913 (1979); SEC v. Kalvex, Inc., 425 F. Supp. 310, 316 (S.D.N.Y. 1975). As a result of the conduct described above, Safety-Kleen violated Section 13(a) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder.

B. Safety-Kleen Violated the Recordkeeping and Internal Controls

Provisions of the Exchange Act

Section 13(b)(2)(A) of the Exchange Act requires issuers to make and keep books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the issuer. Safety-Kleen violated Section 13(b)(2)(A) of the Exchange Act by maintaining books and records which, among other things, falsely understated the company's expenses and liabilities and falsely overstated the company's revenue, assets and earnings.

Section 13(b)(2)(B) of the Exchange Act requires issuers to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that, among other things, transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP. Safety-Kleen violated Section 13(b)(2)(B) of the Exchange Act by failing to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that accounting adjustments were recorded in conformity with GAAP.

C. Moore Was a Cause of Safety-Kleen's Violations

Section 21C of the Exchange Act provides that the Commission may order any person who is or was a cause of a violation of any provision of the Exchange Act to cease and desist from causing such violation. Moore was a cause of Safety-Kleen's reporting, books and records and internal controls violations, when she made accounting adjustments that were not consistent with GAAP.

V.

Based upon the foregoing, the Commission finds that Susan Moore caused violations of Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder.

ACCORDINGLY, IT IS HEREBY ORDERED, pursuant to Section 21C of the Exchange Act, that Susan Moore cease and desist from causing any violations and any future violations of Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 13a-1, 13a-13 and 12b-20 thereunder.

By the Commission.

Jonathan G. Katz
Secretary

___________________________

1	This matter is related to SEC v. Safety-Kleen Corp., Kenneth W. Winger, Paul R. Humphreys, William D. Ridings and Thomas W. Ritter, Jr., Civil Action No. 02-CV-9791 (CSH) (S.D.N.Y.) (December 12, 2002).
2	The findings herein are made pursuant to Moore's Offer of Settlement and are not binding on any other person or entity in this or any other proceeding.

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