Tech Provider Settles SEC Charges for FCPA Violations

A global technology provider settled SEC charges for engaging in bribery schemes of Indian foreign officials to win government contracts. The SEC charged the company with violations of the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act ("FCPA").

According to the SEC's Order, employees of the company's subsidiary in India engaged in corrupt practices by bribing various Indian foreign officials to manipulate public tender offerings to favor its products and to eliminate its competitors in the defense and aerospace sectors. The SEC found that a "variety of schemes were used to funnel the improper payments," including the use of third-party agents to send improper payments to government officials. The SEC found a liaison agreement with an agent, which involved bribes disguised as commission charges. The SEC said the subsidiary had a systemic culture prioritizing profit over compliance.

The SEC determined that the company violated SEA Sections 13(b)(2)(A) and 13(b)(2)(B) ("Periodical and other reports").

To resolve the charges, the company agreed to (i) cease and desist from future violations; (ii) enhance internal controls to include tighter oversight of third-party payments; (iii) pay disgorgement of $504,926 along with prejudgment interest of $78,889; and (iv) accept a civil monetary penalty of $1,100,000, totaling $1,683,815 in fines.