Chipotle in Trouble: SEC Subpoenas the Burrito Chain Over Hiring Practices

In May 2012, Chipotle Mexican Grill disclosed that it had received a subpoena from the Securities and Exchange Commission, as part of the agency's investigation into the burrito chain's hiring practices.

The Denver-based company said it received the subpoena on May 17. The request covered the company's compliance with employee work-authorization requirements, its related public statements and disclosures, and related information. Chipotle said it intended to cooperate fully.

The subpoena was the latest turn in a saga that had been running for over a year. Audits by the Department of Homeland Security's Immigration and Customs Enforcement (ICE) arm had already led the company to fire hundreds of workers. In April 2011, Chipotle revealed that the criminal division of the U.S. Attorney's office for the District of Columbia had opened an investigation and asked the company to turn over documents related to the ICE audits.

For a company that had built its brand on "food with integrity" — ethically sourced ingredients, humane treatment of animals — the hiring-practices investigation was an awkward counterpoint. The question hanging over the company was whether the same standards it applied to its supply chain had been applied to its workforce.

This article summarizes Chipotle's public disclosures and contemporaneous reporting, including Reuters' May 2012 coverage. It reports on regulatory proceedings, not findings of wrongdoing.