We wrote recently about a Bloomberg report alleging that Hampton Creek Foods, an HSUS-backed venture which makes vegan mayo and seeks generally to replace eggs, was secretly buying up its own product from supermarkets in order to inflate demand for the product, and then using these sales figures in pitches to would-be investors. Now Bloomberg reports that the Securities and Exchange Commission is investigating whether Hampton Creek broke the law:
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.
“We’re aware of the informal inquiry and we’ll be sharing the facts, as opposed to the inaccuracies reported by Bloomberg,” Tetrick said in an e-mailed statement.
Whether “informal” or not, this isn’t good news. Whether or not the SEC finds that Hampton Creek violated the law, would any donor be happy that their gift to HSUS was invested in such a company? We suspect even the most diehard vegans might be second-guessing.