Beleaguered snack company Diamond Foods faces a probe from a US stock market regulator over the company’s own inquiry into walnut crop payments.
The Stock Exchange Commission (SEC) has issued Diamond with a formal order of investigation in relation to Diamond’s inquiry into certain crop payments, which has led to a delay in the company’s acquisition of the Pringles brand from Procter & Gamble.
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According to the SEC’s website, a formal order of investigation allows it to compel witnesses to testify and a company to produce books, records, and other relevant documents.
A stock filing from Diamond said: “As previously disclosed, the audit committee of Diamond’s Board of Directors is conducting an investigation of Diamond’s accounting for certain crop payments to walnut growers.
“The SEC has informed Diamond that its investigation should not be construed as an indication by the SEC that any violations of law have occurred. Diamond intends to cooperate fully with the SEC.”
Diamond added it is unable to predict the timing or outcome of the SEC’s investigation.
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By GlobalDataOn Monday (12 December) the company admitted that it would miss a deadline to file its first-quarter results, leaving it open to censure from NASDAQ.
Mystery still surrounds the death of director Joseph Silveira in October. CNBC reported his death as a suicide and that Silveira, a member of the snack maker’s audit committee, had recused himself from the walnut prices investigation. Diamond insisted his death was not linked to the probe.
