Benzinga | Sep 3, 2021 01:41PM EDT

Kraft Heinz To Pay $62M To Settle SEC Charges

* Kraft Heinz Co (NASDAQ:KHC) has been charged by the SEC for engaging in a long-running expense management scheme that resulted in the restatement of several years of financial reporting.

* Kraft Heinz has agreed to pay a civil penalty of $62 million in this regard.

* The SEC also charged Kraft's former COO Eduardo Pelleissone and former Chief Procurement Officer Klaus Hofmann for their misconduct related to the scheme.

* According to the SEC's order, from the last quarter of 2015 to the end of 2018, Kraft engaged in various types of accounting misconduct, including recognizing unearned discounts from suppliers and maintaining false and misleading supplier contracts.

* In June 2019, after the SEC probe began, Kraft restated its financials, correcting a total of $208 million in improperly recognized cost savings arising out of nearly 300 transactions.

* Kraft Heinz has recorded an accrual for the full amount of the penalty in Q2 2021.

* Price Action: KHC shares are trading lower by 0.38% at $35.93 on the last check Friday.