South Korean Telecom Company Settles SEC Charges for FCPA Violations
A South Korean telecom company settled SEC charges for books and records and internal accounting controls violations under the Foreign Corrupt Practices Act ("FCPA").
The SEC found that the company lacked sufficient internal accounting controls over expenses, including as to executive bonuses and purchases of gift cards that enabled managers and executives to "generate" slush funds. The SEC stated that from 2009 through 2017, these slush funds enabled executives to provide items of value to government officials in the Republic of Korea and Vietnam, including gifts, entertainment and illegal political contributions.
To settle the charges, the company agreed to:
cease and desist from committing or causing any violations and any future violations of Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act; and
pay (i) a disgorgement of $2,263,821, (ii) prejudgment interest of $536,457, and (iii) a civil money penalty of $3,500,000.
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