Hampton Creek’s Mayo Buybacks Prompt Inquiry by the SEC
- Agency examining whether company improperly recognized revenue
- Initiating probe doesn’t mean firm will face enforcement case
The U.S. Securities and Exchange Commission is looking into whether a San Francisco-based food technology startup broke the law by not disclosing that it was buying its own vegan mayonnaise from stores, which made the product appear to be more successful than it was, according to people familiar with the matter.
The agency is trying to determine whether Josh Tetrick’s Hampton Creek Inc. improperly recognized revenue from purchases made with company money, said the people, who asked not to be named because the matter isn’t public. The opening of an SEC inquiry into the buybacks is a preliminary step and doesn’t mean the company will face an enforcement action. Bloomberg first reported this month that Hampton Creek undertook an operation to purchase its own mayonnaise starting as early as 2014.