Whistleblower claims Disney inflated revenues for years

By: Jorge F.

Is Mickey cooking the books at the Magic Kingdom?

A Disney whistleblower is telling the Securities and Exchange Commission that the company has been inflating revenues at its parks and resorts division for years, padding income by as much as $6 billion in one year alone, according to a new report in MarketWatch.

Sandra Kuba, a former senior financial analyst for Walt Disney Co., said employees routinely took advantage of “weaknesses” in the company’s software to inflate revenue, including by double-reporting $500 gift cards purchased by guests, and recording gift cards that were discounted or given away for free at full value.

She said that and other shenanigans added up to billions of overreported dollars, estimating that the 2008-09 revenues report could have been overstated by as much as $6 billion. The parks and resorts division claimed total revenues of $10.6 billion in 2009, the report said.

Kuba, who worked for Disney for 18 years, said she began trying to report the irregularities in 2013, but it fell on deaf ears. She finally went to the SEC in August 2017, and was fired the following month. She’s made two SEC whistleblower filings since and, in October 2017, filed an OSHA retaliation complaint against the company — which she later dropped.

She told MarketWatch she continues to speak to the SEC — as recently as last week.

Disney spokesman David Jefferson called Kuba’s claims “utterly baseless.”

“This former employee, who was fired for cause, has persistently made patently false claims for over two years,” Jefferson said in an email to The Post. “The claims she made to the company were thoroughly investigated and found to be utterly baseless.”

“It is unfortunate that MarketWatch, which has been aware of the facts for months, knowingly and deliberately chose to give Ms. Kuba’s unfounded claims a platform.”

But Jordan Thomas, a former SEC official interviewed in the report, suggested that Kuba’s claim is being taken seriously by the agency.

“The fact that the SEC has asked for more information more than once and conducted interviews suggests an inquiry is underway,” Thomas said.