Commision Clawback

[anonymous]

Angry RSM - My accountant has informed me that the current 2024 clawback, which we were paid on in 2023, is based on the gross amount, even though taxes on that income were already withheld and paid in 2023. Meaning the clawback is effectively costing us about 30 to 35% more than we were actually paid.

 

[anonymous]

Have you addressed this issue with the compliance dept?

 

[anonymous]

The following three reasons, when considered together, have made it evident that Aegis is not the ideal place to continue my career.

1. The RSM Medicare clawback was false. It was actually commission fraud: they claimed to have overpaid representatives' commissions, but the reality is they treated the excess as a prepayment for future periods. This tactic artificially inflated expenses in that quarter to reduce profits, and now they are lowering this quarter's expenses by using the fabricated overpayments.

2. It became clear when I reviewed the audit trails that if the overpayment was truly an advance awaiting collection, then why has there not been a single dollar been collected to offset it?

3. Aegis. and this is huge, my manager let it slip that Aegis has stopped paying commissions on all revenue. They now deduct between 6% and 7% from gross revenue before calculating commissions. Reducing commission payouts by almost $500,000.

 

[anonymous]

Frank, Mike, Wells, Joel, Beverly and David,



After reading the clawback post, I did some research on corporate commission fraud and Aegis, and here’s what I found:


If a company intentionally overstates commissions, it’s engaging in a deliberate form of financial fraud. This fraud can occur for several reasons, including manipulating financial statements, deceiving investors, inflating the company’s market value, or avoiding taxes. Here's how such a scenario could unfold:


Inflated commissions are reported as expenses on the company’s financial statements. This has the dual effect of inflating the company’s reported revenues (due to fake or inflated sales) and reducing its taxable income (since commissions are tax-deductible expenses). The company then presents its financial statements, showing higher revenues and profits, to investors, banks, and tax authorities. The overstated commissions make the company appear more profitable and successful than it actually is.


Motivation Behind the Fraud:


Attracting Investment: The inflated financial performance may attract new investors or encourage existing ones to inject more capital into the company. (e.g., Abry Partners)


Securing Loans: The company might use falsified financials to secure favorable loan terms from banks or other financial institutions. (e.g., New Nashville Lab and 2025 debt refinancing)


Tax Evasion: By inflating expenses through overstated commissions, the company can reduce its taxable income, thereby lowering its tax liability.



Biggest Reason for Manipulation:


Aegis Toxicology Sciences Corp.'s CCC+ rating and the May 2025 maturity of a $168 million term loan present significant refinancing risk. The CreditWatch Negative status signals an increased risk of default. Investors and creditors should closely monitor the company's financial performance, records, and any developments related to its approaching debt maturity.


The lack of transparency surrounding the most recent commission clawbacks leads me to believe that some or all of these concerns may be valid.

 

[anonymous]

Frank, Mike, Wells, Joel, Beverly and David,



After reading the clawback post, I did some research on corporate commission fraud and Aegis, and here’s what I found:


If a company intentionally overstates commissions, it’s engaging in a deliberate form of financial fraud. This fraud can occur for several reasons, including manipulating financial statements, deceiving investors, inflating the company’s market value, or avoiding taxes. Here's how such a scenario could unfold:


Inflated commissions are reported as expenses on the company’s financial statements. This has the dual effect of inflating the company’s reported revenues (due to fake or inflated sales) and reducing its taxable income (since commissions are tax-deductible expenses). The company then presents its financial statements, showing higher revenues and profits, to investors, banks, and tax authorities. The overstated commissions make the company appear more profitable and successful than it actually is.


Motivation Behind the Fraud:


Attracting Investment: The inflated financial performance may attract new investors or encourage existing ones to inject more capital into the company. (e.g., Abry Partners)


Securing Loans: The company might use falsified financials to secure favorable loan terms from banks or other financial institutions. (e.g., New Nashville Lab and 2025 debt refinancing)


Tax Evasion: By inflating expenses through overstated commissions, the company can reduce its taxable income, thereby lowering its tax liability.



Biggest Reason for Manipulation:


Aegis Toxicology Sciences Corp.'s CCC+ rating and the May 2025 maturity of a $168 million term loan present significant refinancing risk. The CreditWatch Negative status signals an increased risk of default. Investors and creditors should closely monitor the company's financial performance, records, and any developments related to its approaching debt maturity.


The lack of transparency surrounding the most recent commission clawbacks leads me to believe that some or all of these concerns may be valid.

Good for you, tiger!

 

[anonymous]

The lack of transparency surrounding the most recent commission clawbacks leads me to believe that some or all of these concerns may be valid.

An impressive connecting of the dots! Aegis is not in a good place. The major labs won't touch this business and its 5-year forecast is too dire for private equity. Private equity is looking for companies to flip. They could be part of an industry consolidation, but that leads to redundancies. If they get indicted for financial fraud, then game over.