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Tech Industry

Amazon acknowledges SEC inquiry

The online retail giant confirms it was questioned by the Securities and Exchange Commission over the timing of a stock sale by Chief Executive Jeff Bezos.

The Securities and Exchange Commission questioned Amazon.com over the timing of a stock sale made by Chief Executive Jeff Bezos, company officials confirmed Wednesday.

The investigation revolves around the sale of stock days after the company received a preview copy of a negative analyst report. Company spokesman Bill Curry said Bezos' stock sale was "in full compliance" with company policies.

The SEC has "asked us for information and we are happy to answer their questions," Curry said. "We are confident that there's no cause for any action."

SEC representatives declined to comment.

Bezos sold 800,000 shares of Amazon stock in early February, earning about $11.7 million. The stock sale came just prior to the release of a report that was highly critical of the company by then-Lehman Brothers analyst Ravi Suria, questioning whether Amazon would be able to continue its operations. Executives at Seattle-based Amazon received a copy of the report prior to its being released, and Amazon director John Doerr reportedly pushed Lehman Brothers to quash the report.

"We had a preview version (of the report) that was riddled with errors," Curry said. "We were fully aware that there was nothing new in it."

When Suria released a previous report criticizing Amazon last June, the company's stock took a beating, falling 19 percent in one day and hitting a 52-week low. In contrast, Amazon's stock traded up in the days immediately following Suria's February report.

Last fall, the SEC launched a separate inquiry into how Amazon had accounted for revenues it received from several promotional partnerships. Meanwhile, earlier this year, a slew of shareholder groups sued Amazon, accusing company executives of using misleading statements to inflate the company's stock price.

On Tuesday, the company reported a net loss of $234 million in the first quarter on revenues of $700 million.