Oracle to Pay $23 Million to Settle FCPA Bribery Charges
Oracle Corporation will pay more than $23 million to settle charges it violated parts of the Foreign Corrupt Practices Act when its Turkish, Emirati and Indian subsidiaries used slush funds to bribe foreign officials for business from 2016 to 2019, the Securities and Exchange Commission announced. The company agreed to pay around $8 million in disgorgement and a $15 million penalty, along with agreeing to "cease and desist" from violating the anti-bribery, books and records and internal accounting controls elements of the FCPA, SEC said. Oracle did so without admitting or denying the SEC findings.
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“The conduct outlined by the SEC is contrary to our core values and clear policies, and if we identify such behavior, we will take appropriate action," Michael Egbert, vice president of corporate communications at Oracle, said in an email.
The FCPA settlement marks Oracle's second after the company agreed to pay $2 million in 2012 to resolve charges that it failed to stop its Indian subsidiary from secretly setting aside money from the company's records that was eventually used to make illegal payments to phony vendors in India (see 12081702).
SEC said that Oracle subsidiaries in Turkey and the United Arab Emirates used the slush funds to bribe foreign officials to attend technology conferences in violation of Oracle policies and procedures. In some cases, employees of the Turkish subsidiary used the funds for the foreign officials' families to also attend the conferences or take side trips to California.
“The creation of off-book slush funds inherently gives rise to the risk those funds will be used improperly, which is exactly what happened here at Oracle’s Turkey, UAE, and India subsidiaries,” said Charles Cain, SEC’s FCPA unit chief. “This matter highlights the critical need for effective internal accounting controls throughout the entirety of a company’s operations.”