CHS avoids fine in SEC accounting fraud case
A Minnesota-based agricultural cooperative settled charges levied by the Securities and Exchange Commission (SEC) that the company violated federal securities laws when it filed materially false financial statements with the agency over five years.
CHS is a global agribusiness owned by farmers, ranchers, and cooperatives across the United States, according to its website. In its settlement with the SEC, the company agreed to cease and desist from future violations of federal securities laws but was not fined or otherwise penalized.
The alleged violations stemmed from the actions of former CHS rail freight trader David Pope, who allegedly manipulated the quantities and values of certain freight rail contracts from 2014-18, the SEC said. The misconduct occurred because of CHS’s insufficient internal accounting controls; according to the SEC’s order, CHS allowed Pope to both execute trades and determine their valuations, and no other CHS employee was tasked with confirming the accuracy of the information he provided.