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Diageo facing scrutiny in US over claims of artificially inflating sales

Published:  24 July, 2015

Diageo is facing a probe from the US Securities & Exchange Commission into its distribution activities in the country.

The Wall Street Journal reported that the producer of Guinness, Smirnoff, Johnnie Walker and other leading spirits brands had sent more stock to customers than they needed enabling it to artificially increase its recorded sales.

The SEC has asked the company to provide more information on the allegations.

Diageo confirmed the approach in a statement and said it was "working to respond fully to the SEC's requests for information in this matter."

The company has been subject of takeover speculation in recent weeks with Brazilian businessman Jorge Paulo Lemann and his 3G Capital reportedly in the frame to make a bid.

Diageo releases its second quarter results next week.