Mamma.com is in the SEC hot seat, as an informal investigation has become a formal inquiry into whether the Canadian search firm perpetrated improper trading in relation to undisclosed shareholdings, according to eCommerce Times.

Mamma.com released a statement reading in part, "The company believes that as part of its investigation, the SEC may consider matters related to trading in the company's securities and whether an individual and persons acting jointly or in concert with him may have had a significant influence on the Company in the past as a result of undisclosed shareholdings."

It also indicated that the SEC may be looking into financial reporting and internal controls. In March, Mamma.com announced that its auditor, PricewaterhouseCoopers, had quit and that it would not make Canada's March 31 deadline for reporting results.