ADM SEC Settlement: $40M Fine, Executive Charges, Investor Payouts

Archer-Daniels-Midland agreed to pay a $40 million civil penalty in the ADM SEC settlement announced on January 27, 2026, resolving charges that the company inflated the profits of its Nutrition segment through manipulated internal transactions across fiscal years 2019, 2021, and 2022. ADM neither admitted nor denied the SEC’s findings. Two former executives settled alongside the company. A third, former chief financial officer Vikram Luthar, is contesting the SEC’s civil complaint in federal court in Chicago.¹

What ADM Was Accused of Doing

ADM had told investors that transactions between its business segments were priced at levels “approximating market,” meaning close to what an outside buyer would pay. The SEC found that executives instead directed retroactive rebates and price adjustments on sales between the Nutrition segment and other ADM units, shifting profit into Nutrition to hit publicly promoted operating profit growth targets of 15 to 20 percent per year. The adjustments were labeled as “volume discounts,” “risk sharing,” or product rebates, but according to the SEC they were not supported by original sales agreements or arm’s-length negotiations.²

The Overstatements, Year by Year

In 2019, a $4.7 million adjustment moved profit from Carbohydrate Solutions to Nutrition so the segment would cross a $500 million operating profit threshold.
In 2021, quarterly adjustments, led by a $20.7 million retroactive rebate from Ag Services and Oilseeds, pushed Nutrition’s reported operating profit growth to 20 percent. Actual growth was closer to 17 percent, and quarterly growth figures were overstated by 3 to 6 percent throughout the year.
In 2022, two retroactive adjustments totaling roughly $9.1 million ($2.5 million from Carbohydrate Solutions and $6.6 million from Ag Services and Oilseeds) raised Nutrition’s reported annual growth to 7 percent. Without them it would have been about 5 percent.²

After disclosing an Audit Committee investigation in January 2024, ADM ultimately trimmed $228 million from Nutrition’s operating profit for the 2018 to 2023 period. Nutrition’s 2022 operating profit was reduced by $68 million, and reported 2023 profit for the segment fell from $458 million to $427 million.³

What ADM Paid and Agreed To

Under the cease-and-desist order, ADM agreed to:

Pay a $40 million civil penalty.
Stop violating the antifraud, reporting, books-and-records, and internal-controls provisions of the Securities Act and Exchange Act.
Cooperate fully with the SEC in ongoing litigation and related proceedings, including making current and former employees available for interviews and testimony.¹

The SEC credited ADM for the Audit Committee investigation, voluntary self-reporting, analyses from an outside accounting expert, and new internal controls over intersegment pricing.¹

The Three Former Executives

Vikram Luthar, Former CFO

Luthar was finance chief for the Nutrition segment before becoming ADM’s company-wide CFO. He refused to settle. On January 27, 2026, the SEC filed a civil complaint against him in the U.S. District Court for the Northern District of Illinois, alleging he orchestrated the improper adjustments in fiscal years 2021 and 2022. The complaint charges him with antifraud violations, aiding and abetting ADM’s reporting and internal-controls failures, and failing to reimburse ADM for compensation under Section 304 of the Sarbanes-Oxley Act. The SEC says Luthar received a $130,000 cash bonus in 2022 tied to Nutrition’s inflated performance and sold more than $1.8 million of ADM stock at allegedly inflated prices. It is seeking permanent injunctions, an officer-and-director bar, disgorgement with interest, civil penalties, and clawback of that compensation.⁴

Luthar filed a 61-page answer on March 27, 2026, denying every allegation. His attorneys argue he reasonably relied on the advice of qualified internal and external accounting professionals.⁵ The case is in early stages.

Vince Macciocchi, Former President of the Nutrition Segment

Macciocchi ran the Nutrition segment from March 2018 through December 2023. The SEC found that he and Luthar led efforts to identify and structure the intersegment adjustments in 2021 and 2022. Without admitting or denying the findings, he agreed to pay $330,000 in disgorgement, $74,343 in prejudgment interest, and a $125,000 civil penalty. He is barred from serving as an officer or director of any public company for three years.²

Ray Young, Former Company-Wide CFO

The SEC found that Young negligently approved the improper adjustments for fiscal years 2019 and 2021, failed to disclose them on earnings calls and in SEC filings, and rendered ADM’s financial reports materially false and misleading. Without admitting or denying the findings, he agreed to pay $450,000 in disgorgement, $125,610 in prejudgment interest, and a $75,000 civil penalty. Young was not subject to an officer-and-director bar.²

Money Going Back to Investors

All penalties, disgorgement, and prejudgment interest collected from ADM and the settling executives were ordered into a Fair Fund under the Sarbanes-Oxley Act, to be distributed to investors harmed by the fraud. The SEC’s order did not specify a timeline or a claims process.⁶

The DOJ Investigation Is Closed

The Department of Justice ran a parallel criminal investigation into ADM’s intersegment sales reporting. Reuters reported in late 2024 that the U.S. Attorney’s Office for the Southern District of New York was examining potential securities fraud and conspiracy, and that federal grand juries had summoned more than three dozen current and former employees to testify about transactions dating back to 2018.⁷

On January 27, 2026, ADM announced that the DOJ had closed its investigation of the company with “no further action.”⁸ CFO Dive reported that investigations into individual employees may still be ongoing.⁹

The Shareholder Case Is Not Over

The SEC action is separate from a private securities fraud class action, Chow v. Archer-Daniels-Midland Co. (No. 1:24-cv-00634), filed in the U.S. District Court for the Northern District of Illinois in January 2024. The National Elevator Industry Pension Fund and KBC Asset Management NV lead the case. The complaint alleges that ADM’s accounting fraud caused investors to buy stock at artificially inflated prices and that ADM shares fell 24 percent when the practices came to light.¹⁰

On March 12, 2025, Judge Thomas M. Durkin denied ADM’s motions to dismiss in full, citing the government investigations and executive departures as contributing to a “strong inference of intent.”¹⁰ The case has moved into discovery, and ADM has pushed back on the scope of the plaintiffs’ document requests.¹¹

Why the Controls Failed and What Changed

The SEC did not find that ADM lacked controls over intersegment pricing. It found that executives overrode the ones in place. In September 2022, an ADM controller initially rejected a $2.5 million rebate because there was no contractual basis for it. According to CFO Dive’s summary of the SEC’s account, Luthar pressured the controller to reverse course and approve the adjustment.⁹

ADM has since disclosed a material weakness in its internal controls over financial reporting, added new controls specifically governing intersegment transaction pricing, amended related policies and procedures, developed training programs, and begun testing effectiveness.² The company has also said it made “significant changes to its financial leadership team.”⁸

1
SEC. SEC Charges ADM, Three Former Executives With Accounting and Disclosure Fraud
2
SEC. In the Matter of Archer-Daniels-Midland Company, Vince Macciocchi, and Ray Young, Administrative Proceeding File No. 3-22588
3
Financial Times. ADM Restates Nutrition Segment Profits
4
SEC. Complaint, SEC v. Vikram Luthar
5
Yahoo Finance. ADM Ex-CFO Denies SEC Allegations
6
SEC. Administrative Proceedings, File No. 3-22588
7
Reuters. Internal Transactions at Food Giant ADM Spark Sprawling Criminal Probe
8
ADM Investor Relations. ADM Announces Closure of Government Investigations Related to ADM’s Prior Reporting Regarding Intersegment Sales
9
CFO Dive. 5 Takeaways From the SEC’s Action Against ADM
10
Robbins Geller Rudman & Dowd LLP. ADM Must Defend Against Investor Claims of Accounting Issues
11
Law360. Chow v. Archer-Daniels-Midland Company