By Christiana Sciaudone
Investing.com -- Exxon Mobil dropped more than 3% after The Wall Street Journal reported the company is being investigated for overvaluing property.
The Securities and Exchange Commission initiated the investigation after an employee filed a whistleblower complaint last fall alleging Exxon (NYSE:XOM) overvalued a key asset in the Permian Basin, one of its most important oil and gas properties, the Journal said, citing people familiar with the matter.
Several people involved in valuing the asset complained during an internal assessment in 2019 that employees were being forced to use unrealistic assumptions about how quickly the company could drill wells there to arrive at a higher value, according to a copy of the complaint reviewed by The Wall Street Journal.
At least one of the employees who complained was fired last year, according to a person familiar with the matter. The SEC and Exxon declined to comment.
Demand for oil has plummeted since measures to stem the spread of Covid-19 closed businesses, schools and workplaces around the world for months on end. Although vaccines are now being distributed worldwide, infections and deaths resulting from the virus are surging, and cities and countries around the world remain locked down.
Exxon's revenue dropped by $20 billion to $46 billion the most recent quarter compared to a year earlier, according to data compiled by Investing.com. The company also reported a loss per share of 18 cents in the quarter, versus a profit of 68 cents per share a year earlier.