Troy, MI, August 15—-Auto interior supplier Collins & Aikman said a federal grand jury has subpoenaed its financial statements for 2000 to 2005 and accounting documents related to customer and supplier rebates.
Collins & Aikman, which filed for Chapter 11 protection in May only days after it warned of a significant liquidity crunch, said it intended to cooperate with the grand jury subpoena from the U.S. attorney for the Southern District of New York.
The company also is responding to requests for similar information from the U.S. Securities and Exchange Commission, which does not have a formal inquiry at this point, company spokesman David Youngman said.
A handful of shareholder lawsuits seeking class action status have been filed in recent months naming the company and former officers as defendants, including former chief executive David Stockman, budget director under President Ronald Reagan. Stockman resigned from the company five days before the bankruptcy.
Collins & Aikman in March said it had identified accounting errors for supplier rebates and likely would have to restate results. It also said it had launched an internal review and retained independent counsel for the investigation.
The disclosure comes as Collins & Aikman faces an Aug. 31 deadline to present a business plan to the court. Its largest automaker customers have agreed to provide loans, pay more for parts and fund capital needs to keep it running through September.
Most of Collins & Aikman's U.S. companies filed for bankruptcy May 17, blaming pressure from heavy debt loads that had funded acquisitions, vehicle production cuts and rising raw materials costs.
In mid July, its European companies moved into administration, which is similar to a Chapter 11 proceeding, and Collins & Aikman said likely actions include going concern sales of some or all of its European businesses.
