In 2019, the Securities Exchange Commission began conducting an investigation of an accounting scheme from Kraft Heinz, one of the world's biggest food and beverage organizations. After finding illegitimate contracts and inflated profits, the SEC announced that it charged the 3G Capital owned conglomerate and two of its former executives $62 million for going against federal anti-fraud regulations.

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The SEC found that Kraft Heinz, maker of such products as Heinz Ketchup, had been deliberately mishandling its accounting to appear more appealing to investors. They found that the misconduct had been undergoing from the last quarter of 2015 to 2018.

"Kraft and its former executives are charged with engaging in improper expense-management practices," a statement from the SEC read, "that spanned many years and involved numerous misleading transactions, millions in bogus cost savings, and a pervasive breakdown in accounting controls."

The SEC found plenty of faulty contracts that showed discounts that were secretly tied to planning price hikes and upfront payments that failed to disclose future orders.

Two former execs from Kraft Heinz received individual charges. Eduardo Pelleissone, former chief operating officer, and Klaus Hofmann, former chief procurement officer, agreed on paying a civil penalty of $400,000, according to Business Insider. Because of this incident, Hofmann is paid $100,000 and is currently unable to serve within an officer or director position for the next five years. Pelleissone agreed to pay a $314,211 fine.

The SEC alleged that the two execs acted obliviously to the warning signs regarding the mishandling of Kraft Heinz's accounting.

Though Kraft put out a statement regarding the charges, they carefully made sure not to confirm nor deny the legitimacy of the scheme.

"We have fully cooperated with the SEC throughout its investigation," the conglomerate's global chief communications officer Kathy Krenger said in an email statement to CNN Business "and took prompt and extensive remedial action and proactive steps to improve our internal policies, procedures, and internal controls over financial reporting."

Krenger also expressed in a separate statement that the pitfalls which brought Kraft Heinz the eight-figure charge have since been taken attended to.

"The internal control weaknesses we identified and disclosed in 2019 were fully remediated in 2020. Kraft Heinz is much stronger today because of the actions we took and embedded into our company culture," Krenger explains.

The conglomerate's stocks dropped 1.53% the day the SEC's announcement was released. Its shares now stand at $35.83.

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Sources: Business InsiderCNN Business, CBS News