Kraft Heinz to pay $62M to settle securities violations

[TexasTowelie]

Kraft Heinz Co. has agreed to pay the U.S. Securities and Exchange Commission a civil penalty of $62 million for what regulators called a “multiyear expense management scheme” meant to mislead investors about how much cost the company was cutting after its 2015 merger.

The settlement, which the food giant announced in a public filing, also calls out Eduardo Pelleissone, former COO and global head of operations, for his role in the scheme, saying he created a high-pressure environment to show that the company was reaching increasingly unrealistic cost targets. The SEC also said he allowed the reporting of inaccurate financial statements.

Mr. Pelleissone had served as head of operations at Heinz before the merger that combined Pittsburgh’s H.J. Heinz Co. with Kraft Foods Group. He left the company in 2019 and, according to the settlement, will be fined more than $300,000.

Kraft Heinz, in the run-up to the merger, touted the cost-cutting potential of the deal.

Read more: https://www.post-gazette.com/business/money/2021/09/03/Kraft-Heinz-to-pay-62-million-to-settle-securities-violations-SEC-merger/stories/202109030113