09:28 AM EDT, 06/10/2024 (MT Newswires) -- HF Foods Group ( HFFG ) said Monday it has settled a US Securities and Exchange Commission investigation into alleged securities law violations by agreeing to a cease-and-desist order and a $3.9 million penalty.

The food distribution company said the SEC allegations involved "fraudulent conduct" by its former chairman and chief executive Zhou Min Ni and its former chief financial officer Jian Ming Ni.

HF Foods ( HFFG ) said it neither admitted nor denied the SEC's findings.

Following the SEC's complaint against the former executives filed on June 3, both have agreed to civil fines, disgorgement, and officer and director bars, with Zhou Min Ni also agreeing to a conduct-based injunction preventing his involvement in the HF Foods' ( HFFG ) management, the company said.

Additionally, the company's Special Litigation Committee secured a settlement from the former executives, approved by the Delaware Chancery Court, HF Foods ( HFFG ) said.