The Joplin Globe, Joplin, MO

Business

May 23, 2012

Chipotle federal immigration probe: ’We didn’t do anything wrong’

LOS ANGELES — Chipotle Mexican Grill Inc. continues to get heat for its hiring practices, with the Securities and Exchange Commission and now federal prosecutors looking into the company.

Earlier this week, the U.S. attorney for the District of Columbia told the Denver-based burrito chain that it was under investigation, according to an SEC filing. Prosecutors are probing possible criminal violations of securities laws related to Chipotle’s choice of employees — some of whom were suspected of being undocumented.

The investigation will attempt to determine whether Chipotle complied with employee work authorization verification and disclosure requirements and piggybacks on a previous probe from federal prosecutors. Executives said they now believe the government will continue examining the company for another year or two.

Chipotle said in the filing that it intends “to continue to fully cooperate in the government’s investigations.” But at a Morgan Stanley conference Wednesday, co-Chief Executive Montgomery Moran said the renewed interest caught the company off-guard.

“We thought that it was probably winding down, so we were surprised,” he said of the investigation.

“We didn’t do anything wrong,” he added, saying that Chipotle has already sent over 300,000 pages of documents to the government.

The SEC separately subpoenaed Chipotle last week asking for more information, according to another filing from the company.

“It’s not the 11th hour anymore, so we’re back to earlier innings,” Moran said.

In 2010, Chipotle fired 450 illegal employees in Minnesota after being probed by the U.S. Immigration and Customs Enforcement agency, an arm of the Department of Homeland Security. The investigation stretched from Washington, D.C. to Los Angeles, encompassing many Chipotle markets in between.

The chain, which doesn’t believe in the franchise model, controls all its own hiring decisions.

But the controversy hasn’t had much effect on Chipotle stock, which has boomed roughly 40 percent over the last 52 weeks. Last month, the chain said its net income for the first quarter soared more than 35 percent to $62.7 million, or $1.97 a share.

 

1
Text Only
Business
Poll

Missouri Republicans are considering a new approach to prevent federal agents from enforcing laws the state considers to be infringements on gun rights: barring them from future careers in state law enforcement agencies. Do you think this proposal has merit?

Yes
No
     View Results
Facebook
Twitter Updates
Follow us on twitter
NDN Video
Raw: Greeks Celebrate Easter With "Rocket War" Police Question Captain, Crew on Ferry Disaster Raw: Orthodox Christians Observe Easter Rite Ceremony Marks 19th Anniversary of OKC Bombing Raw: Four French Journalists Freed From Syria Raw: Massive 7.2 Earthquake Rocks Mexico Captain of Sunken SKorean Ferry Arrested Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Pope Presides Over Good Friday Mass Raw: Space X Launches to Space Station Superheroes Descend on Capitol Mall Man Charged in Kansas City Highway Shootings Obama Awards Navy Football Trophy Anti-semitic Leaflets Posted in Eastern Ukraine Raw: Magnitude-7.2 Earthquake Shakes Mexico City Ceremony at MIT Remembers One of Boston's Finest Raw: Students Hurt in Colo. School Bus Crash Raw: Church Tries for Record With Chalk Jesus Raw: Faithful Celebrate Good Friday Worldwide Deadly Avalanche Sweeps Slopes of Mount Everest