CFTC Charges Kraft, Mondelez For Wheat Price Manipulation

(RTTNews) - The U.S. Commodity Futures Trading Commission has charged Kraft Foods Group Inc (KRFT) and Mondelez Global LLC (MDLZ) for wheat price manipulation and reaping undue profit in the process, reports said on Wednesday.

The complaint against Kraft and Mondelez is that the companies used manipulative practices in December 2011 to lower wheat prices on the spot market.

As per the charges, Kraft and Mondelez bought about $90 million of wheat futures, but never meant to take delivery of the wheat. And as market prices reacted, the two companies made a profit of more than $5.4 million.

The CFTC filed the civil complaint against Kraft and Mondelez in federal court in Illinois. The regulator was seeking a permanent injunction from future violations as well as disgorgement and civil monetary penalties.

The charges against Kraft and Mondelez pertain to the period prior to their split in 2012.

KRFT closed on Wednesday at $90.70, up $3.58 or 4.12%, on a volume of 14.5 million shares on the Nasdaq. In after hours, the stock dropped $0.32 or 0.35%.

MDLZ closed at $36.29, up $0.20 or 0.57%, on a volume of 10.2 million shares on the Nasdaq. In after hours, the stock gained $0.04 or 0.10%.