ORLANDO, Fla. (WESH) – Just as Disney World is preparing to unveil Star Wars: Galaxy’s Edge, it’s facing allegations that it’s not properly reporting theme park and resort revenue to regulatory and government agencies.
The story was first reported Tuesday by MarketWatch, the financial news arm of Dow Jones.
Francine McKenna reported that a former senior financial analyst with Disney, Sandra Kuba, claims she filed a whistleblower complaint alleging “The parks and resorts segment systematically overstated revenue by billions of dollars by exploiting weaknesses in the company’s accounting software.”
McKenna told WESH 2 News that Kuba alleges Disney “collected the sales tax from the customers but then they reported to the government that the revenue was from things that were taxed at a much lower rate.”
The result, according to McKenna, is that Disney was underpaying sales taxes.
Disney replied in a statement Tuesday, calling the claims false.
“This former employee, who was fired for cause, has persistently made patently false claims for over two years. 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.”
McKenna reports, “another alleged action Kuba described in her SEC filing involved recording revenue for $500 gift cards at their face value even when guests paid a discounted rate of $395.”
“It warrants attention again just based on the figures mentioned in the report,” said Joe Debello, a local financial expert.
Debello said the allegations demand complete federal and state investigations, but he cautions investors about overreacting.
“It’s really important for anyone who has a stake in Disney, whether that’s through their corporate retirement plan that is offered by work, or an individual shareholder, that they allow this to play out and that they don’t react too swiftly one way or the other,” Debello said.
The Securities and Exchange Commission does not comment on whistleblower reports until investigations are complete.