Whole Foods Market CEO John Mackey is reportedly facing an informal investigation from the US Securities and Exchange Commission over the remarks he posted anonymously on the Internet regarding rival firm Wild Oats Markets.
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News of the probe by the market watchdog follows revelations last week that Mackey had, between 1999 and 2006, used online financial forums to post critical remarks about Whole Foods’ competitor Wild Oats, including suggestions that the shares were over-priced. The postings, which were made under the pseudonym “rahodeb”, also included positive remarks about his own company.
According to a report from the Wall Street Journal, which quoted anonymous sources, the issues the SEC may look into include whether Mackey posted information about his company that contradicted its public statements, and whether they were too optimistic about Whole Foods’ performance.
Although it is not clear whether any laws have been broken, the disclosure of Mackey’s online activities come at a difficult time, with the Federal Trade Commission (FTC) reviewing Whole Foods’ proposed takeover of Wild Oats.
The FTC is trying to block the merger on anti-trust grounds, claiming that consumer choice in the natural and organic sector would be undermined if the deal went through.
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By GlobalDataFurthermore, Mackey took the somewhat unusual step last month of launching a blog on WFM’s website to attack the FTC’s stance and promote the benefits of the merger.
Last week, Mackey used the same blog to defend his earlier postings, saying they were just him having fun, and sometimes represented his views and sometimes did not. “Rahodeb’s postings therefore do not represent any official beliefs, policies, or intentions by either Whole Foods Market or by me,” he said.
