ADM shareholder sues company, execs for fraud
(Reuters) — A shareholder of Archer-Daniels-Midland has sued the commodities trader in U.S. federal court, days after the company’s stock plunged 24% on news that a securities regulator was investigating accounting practices in its nutrition segment.
Raymond Chow, an individual investor, said in the proposed class-action lawsuit filed in Chicago Wednesday that ADM lied about the profitability of its nutrition segment, which supplies food and beverage manufacturers.
An ADM spokesperson declined to comment on the lawsuit on Thursday.
On Monday ADM stock tumbled 24% after the company placed Chief Financial Officer Vikram Luthar on administrative leave. Mr. Chow is seeking damages for investors who bought ADM shares between April 30, 2020, and that date.
The lawsuit alleges that executive stock awards tied to the performance of the nutrition segment incentivized Mr. Luther, ADM President Juan Luciano and former CFO Ray Young to make false statements to investors.
The shareholder lawsuit came less than a week after ADM said it was investigating accounting practices in its nutrition segment after a voluntary document request from the U.S. Securities and Exchange Commission. ADM has said it is cooperating with the regulator.
