Risk & Compliance

General Mills, Executives Receive Wells Notice

Company had also been contacted regarding the Ahold investigation.
Stephen TaubFebruary 5, 2004

General Mills Inc. announced that it has received a Wells notice from the Securities and Exchange Commission in connection with the SEC’s probe, first made public in October, into the company’s sales practices and related accounting.

The notice also covers chief executive officer Steve Sanger and chief financial officer James Lawrence.

Under the SEC’s procedures, a Wells notice indicates that the staff has made a preliminary decision to recommend that the commission bring a civil action; recipients have the opportunity to respond to the SEC staff before a formal recommendation is finalized.

Last April the cereal maker was one of a number of food companies contacted by the SEC as part of the agency’s probe into illegal accounting at Ahold NV’s U.S. Foodservice division. Last year, U.S. Foodservice restated earnings downward by $880 million after disclosing that executives had inflated supplier rebates.

General Mills said its sales practices and related accounting comply with all applicable rules and regulations and that it is continuing to cooperate with the SEC.