NEW YORK (CNN/Money) - Shares of Nortel Networks dropped Monday after the telecom equipment maker said the Securities and Exchange Commission will launch a formal investigation into the firm's restatement of certain financial results.

Nortel (NT: Research, Estimates) shares finished 3.7 percent lower to $6.06 on the New York Stock Exchange.

In mid-March, Nortel suspended Chief Financial Officer Douglas Beatty and Controller Michael Gollogly less than a week after the company warned it would likely restate its results for the second time in six months and delay filing key documents with U.S. securities regulators.

Nortel said Monday the accounting review had already been the subject of an informal SEC inquiry, and of an independent review by its own audit committee.

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The independent accounting review launched last year by Nortel's audit committee was initially viewed by many as a housekeeping exercise.

But with U.S. accounting scandals like Enron, WorldCom and Freddie Mac still fresh in their minds, many analysts are now questioning if the review has uncovered deeper and more worrying problems.