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SEC Probing Activision, Acclaim

The companies say they've been notified of an investigation of the game industry.


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said it has been informed that the

Securities and Exchange Commission

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has started a formal investigation related to the accounting methods of the video game industry.

The probe "appears to be focused on certain accounting practices common to the interactive entertainment industry, with specific emphasis on revenue recognition," Activision said in a filing with regulators.

The SEC has asked Activision for information, and according to the filing, other companies in the industry have also been contacted.

"The SEC has advised Activision that this request for information should not be construed as an indication from the SEC or its staff that any violation of the law has occurred, nor should it reflect negatively on any person, entity or security," the filing stated.

Activision said it will cooperate with the SEC on the matter. The company's stock was down 10.5% to $11.15 after the bell, and other names in the sector were under pressure, as well.

In a separate filing,

Acclaim Entertainment


said it was notified on July 11 that it's included in the SEC inquiry, and the company also has been asked to supply regulators with information.

Acclaim said it, too, is cooperating with the probe. Neither filing named any other game publishers as having been contacted, and no other video game companies had released statements regarding the probe as of Friday afternoon.