Disclosure Games: Wait 'Til You See Where This SEC Investigation Was Buried
NEW: Confirmed, Undisclosed SEC Investigation at New Fortress Energy, Inc. (NFE)
A printable PDF version of this report appears at the bottom.
See that tiny print highlighted in the image below?
Below is an excerpt from an 8-K filed 27-Mar-2025 by New Fortress Energy. Specifically, it’s the entirety of the text from the Forward Looking Statements portion of the 8-K.
As any seasoned investor knows, Forward Looking Statements are widely viewed as boilerplate language that no one ever reads. It’s also where New Fortress Energy buried an SEC Investigation.
The language highlighted above is so tiny you can’t read it here, and most people surely didn’t even bother to try when they came across it in the 8-K.
Here’s what it says –
Specific factors that could cause actual results or events to differ from those in the forward-looking statements include, but are not limited to: … the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, including the impact of SEC and other investigative and legal proceedings;
These people are playing Disclosure Games®. That text highlighted above is brand new. A search of the company’s SEC filings, back to the 8-K filed 28-Feb-2023, otherwise found no clear disclosure of SEC investigative activity.
In well over 25 years of reviewing SEC filings, the only other time we saw this stunt was over ten years ago, when Hertz Global Holdings (HTZ) did the same thing, in an 8-K filed on 04-Nov-2014. Ten days later, on 14-Nov-2014, Hertz more clearly disclosed an SEC investigation on which it gave no detail.
DI’s Research:
In our research, an early signal of a possible SEC investigation was received on 11-Dec-2024. Signal was then confirmed as an ongoing investigation on 06-Mar-2025. This is a change from a response dated 16-Jan-2024, at which time no signs of ongoing SEC investigative activity were found.
As we said above, a search of SEC filings, back to the 8-K filed 28-Feb-2023, found no clear disclosure of SEC investigative activity. We have no documents or meta-data from closed SEC probe(s) of this company. This is the first sign of an SEC investigation we found since we started covering New Fortress Energy in Mar-2023.
Notable Items:
10-K delayed, NT 10-K filed on 04-Mar-2025:
The Company requires additional time to complete its financial statement preparation and review process. In addition, the Company requires additional time in order to reflect certain financing transactions which will support the Company's obligations and debt service and are expected to close in the near term.
SEC investigation cited in Forward Looking Statements, 8-K filed on 27-Mar-2025:
Specific factors that could cause actual results or events to differ from those in the forward-looking statements include, but are not limited to … the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, including the impact of SEC and other investigative and legal proceedings;
DI's Take:
The lawyers clearly felt the risk from the SEC investigation we found was high enough that something had to be disclosed. However, someone at the company made the choice to obscure this information, burying it in a location unlikely to attract attention. You decide. Is this a company worthy of your capital?
Our work suggests New Fortress Energy may have known about an SEC probe since at least Dec-2024. Given this, and the new language buried in the Forward Looking Statements, that delayed 10-K in Mar-2025 takes on added meaning now.
– John P. Gavin, CFA, NACD.DC
“Disclosure Games®” is a term we use to highlight those public companies engaging in disclosure practices that in our opinion may be misleading, confusing, evasive, or otherwise lacking the transparency needed for investors to make well-informed investment decisions regarding a potentially material exposure.
For reasons outlined in this report, we have identified New Fortress Energy as a company playing Disclosure Games.
To learn more about our research process, including how to best use this information in your own decision-making, click here.
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