Video update.

Videogame maker Take-Two Interactive Software Inc., which along with Santa Monica-based competitors Activision Inc. and THQ Inc. has been under investigation by the SEC, said the U.S. government plans to file a civil complaint for improperly reporting its sales.

Take-Two Chairman Ryan Brant, the company, an employee and two former officers received so-called Wells notices from the Securities and Exchange Commission, the New York-based videogame maker said in a statement. Take-Two makes the popular "Grand Theft Auto" games.

A Wells notice informs recipients that the SEC plans to bring a complaint and asks them to explain why it shouldn't be filed.

The SEC has been investigating whether Take-Two and other game makers, including THQ and Activision, booked sales to distributors and retailers prematurely and whether they had a way to verify orders and accounting entries.

"We know there's an investigation in practices in the industry involving accounting practices and revenue recognition," said Ian Corydon, an analyst at B. Riley in Los Angeles. Corydon said he owns no shares in the videogame companies, and B. Riley does no investment banking for them but is a market maker for the L.A. videogame firms.

He said THQ and Activision are part of the general probe of the industry and it is unclear whether that investigation is connected to the action taken against Take-Two.

Take-Two said it complied with relevant accounting rules for such sales. The SEC will seek an injunction and monetary damages, Take-Two said.

"All we can say about the investigation is that we are in active talks with the SEC," Take-Two Chief Executive Jeffrey Lapin said on a conference call. "I can not promise you that we are near the end of things."

Last week, Activision officials declined comment. THQ officials didn't return calls seeking comment.

--Bloomberg News, Kate Berry