Technology Company Fined for Repeat FCPA Violations

A technology company settled SEC charges for violating the FCPA by failing to prevent employees of multiple subsidiaries from engaging in schemes to bribe foreign officials. The company previously settled with the SEC on similar charges (see previous coverage).

In the Order, the SEC found that several employees of subsidiaries based in India, Turkey and the United Arab Emirates used discount schemes and false marketing reimbursement payments to finance slush funds used to bribe foreign officials. The company occasionally provided other benefits, including paying for foreign officials to attend technology conferences around the world, and trips to the United States. The employees filed reimbursements for phony marketing expenses, as employees were not required to provide documentation for marketing expenses under $5,000.

The SEC determined that the company violated Exchange Act Section 13(b)(2)(A)-(B) ("Periodical and other reports") and Section 30A ("Prohibited foreign trade practices by issuers"). To settle the charges, the company agreed to (i) cease and desist from committing or causing any future violations and (ii) pay a civil monetary penalty of $15 million, as well as $7,114,376 in disgorgement and $791,040 in prejudgment interest.