US: Diamond to pay US$5m to settle accounting scandal

By Katy Askew | 10 January 2014

Diamond puts accounting scandal to rest with SEC payment

Diamond puts accounting scandal to rest with SEC payment

Diamond Foods will pay a fine of US$5m to settle charges related to an accounting scandal that saw the company delay recording payments to walnut growers in order to inflate profits.

Between 2010 and 2011, Diamond's then-CFO Steven Neil fraudulently under-reported money paid to walnut growers in order to boosted reported net earnings, the US Securities and Exchange Commission said yesterday (9 January).

Neil and then CEO Michael Mendes were replaced after an internal investigation uncovered the improper accounting. Diamond also had to re-state accounts for two financial years.

"Diamond Foods misled investors on Main Street to believe that the company was consistently beating earnings estimates on Wall Street," said Jina Choi, director of the SEC's San Francisco regional office. "Corporate officers cannot manipulate fiscal numbers to create a false impression of consistent earnings growth."

Both Diamond Foods and former chief executive Michael Mendes have reached settlements with the securities regulator. Mendes will pay a fine of $125,000 and has already forfeited or returned more than $4m he received in bonuses for the 2010-11 period. Litigation against Neil is ongoing, the SEC added.

Sectors: Financials, Snacks

Companies: Diamond Foods

View next/previous articles

Currently reading -

US: Diamond to pay US$5m to settle accounting scandal

There are currently no comments on this article

Be the first to comment on this article

Related research

Diamond Foods, Inc. - Mergers & Acquisitions (M&A), Partnerships & Alliances and Investment Report

MarketLine's Company Mergers & Acquisitions (M&A), Partnerships & Alliances and Investments reports offer a comprehensive breakdown of the organic and inorganic growth activity undertaken by an organization to sustain its competitive advantage....

Diamond Foods, Inc. : Consumer Packaged Goods - Company Profile, SWOT & Financial Report

Canadean's "Diamond Foods, Inc. : Consumer Packaged Goods - Company Profile, SWOT & Financial Report" contains in depth information and data about the company and its operations. The profile contains a company overview, key facts, major products and ...

Savory Snacks in the United States

Savory Snacks in the United States industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2007-2011, and forecast to 2016). The profile also contains descriptions of ...

Related articles

US: Diamond posts Q2 loss but shares rise

Shares in Diamond Foods rose despite the US snack maker posting a second-quarter loss after the company's sales and underlying earnings beat analyst expectations.

UK: Kettle launches "better for you" baked line

Up-market crisp maker Kettle Foods is launching a line of lower-calorie baked chips in the UK.

Welcome to the home of food information, insight & intelligence

Not a member? Join here

Decrease font sizeDecrease font sizeDecrease font size Increase font sizeIncrease font sizeIncrease font size Comment on this article Email this to a friend Print this page