It looks like fake SEC filings are becoming a hot trend “on” Wall Street. Why this is happening or who is stupid or emotionally disturbed enough to do this, however, remains an open question. If there was any hope at all of getting away with it, then there would at least be a profit motive, but in this case no one in their right mind can possibly expect to not get caught – unless of course they are located outside in the U.S. in a hard to reach location for American regulators.
The fraud du jour this week is fake SEC filings for Heinz Kraft and Phillips 66 by someone named Loreto M. Zamora, who is apparently based in the Philippines.
Efforts by the media to reach Zamora were not successful, and a spokesperson from the SEC had comment on the false filings.
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More on fake SEC filings for Kraft Heinz and Phillpps 66
Two separate filings were submitted by Loreto M. Zamora to the U.S. SEC on Thursday morning claimed that he held at least 10% stakes in Kraft Heinz and Phillips 66.
The Wall Street Journal first reported and confirmed with both companies that the filings are frauds and they have referred the matter to the SEC. Warren Buffett, whose Berkshire Hathaway holds major stakes in both firms, told the WSJ in an email that he has never heard of Zamora.
In one filing, Zamora also falsely called himself a director of Kraft Heinz (Buffett is on the BoD). The filings included an address in the Philippines. Several media sources have noted that Zamora also seems to have a notable social media presence, with a number of tweets praising Buffett and Berkshire.
Zamora filed the supposed stakes in the firms on an SEC Form 3, which is a form used to disclose an initial stake by an insider or other investor with a 10% or larger holding in a firm. Analysts, the media and investment firms regularly monitor SEC filings for breaking news, as new stakes can cause share prices to move up.
However, this time shares of Kraft Heinz and Phillips 66 didn’t move much on the fake SEC filings, and both stocks ended the day down less than 1%.
Of interest, the SEC has already noted that it is looking into the need to make changes to the public securities filing system (Edgar).
Earlier Fake SEC Filings
In an indirectly related case, the SEC settled charges against private investment firm G Asset Management on Thursday. G Asset was the investment firm that published a “manipulative” news release in February of last year announcing a fake takeover bid for bookseller Barnes & Noble. The firm's principal is disgorging all profits and is barred from employment in the securities industry for five years, but G Asset did not admit or deny the SEC's findings in the settlement.
The latest false filings in Kraft Heinz and Phillips 66 are very much like what happened in May of this year, when a fictitious firm filed a fraudulent buyout bid for Avon Products. Avon noted at the time that they had not received any bid. A month later, the SEC filed a lawsuit against a Bulgarian national who it alleges made the fake SEC filing. Knowledgeable sources point out that the FBI is involved in the investigation of the Avon case.