The Securities and Exchange Commission (SEC) continues to ramp up its enforcement of the Federal Corrupt Practices Act (FCPA). In 2010, the SEC’s Enforcement Division created a specialized unit dedicated to enforcement of the FCPA, which prohibits U.S. companies from bribing foreign officials for government contracts and other business. To date, the agency has brought and settled nine separate enforcement actions in 2015.
Bristol-Myers Squibb Co. (BMS) is the most recent company to resolve FCPA charges. The company will pay nearly $14.7 million to settle allegations that its joint venture in China bribed health care providers at state-controlled hospitals in an effort to boost drug sales.
“Certain sales representatives of the joint venture improperly generated funds that were used to provide corrupt inducements [to health care providers] in the form of cash payments, gifts, meals, travel, entertainment, and sponsorships for conferences and meetings in order to secure new sales and increase existing sales,” the SEC stated. “BMS falsely recorded the relevant transactions as legitimate business expenses in its books and records.”
Additional enforcement actions
More enforcement actions are expected in the coming months. In addition to resolved cases, at least 78 companies reported that they are subject to an ongoing FCPA investigation in SEC filing as of September 30, according to Corporate Counsel.
In several cases, the FCPA violations did not involve outright bribes, suggesting that the SEC is making good on its “broken windows” policy in the FCPA arena. As we have previously mentioned on this blog, under the leadership of SEC Chair Mary Jo White, the agency’s enforcement policy is to “pursue even the smallest infractions” as a means of deterring more serious violations.
In its case against Hyperdynamics Corporation, the SEC alleged that the energy company committed books and records and internal controls offenses. Notably, the Department of Justice concluded its FCPA investigation without bringing charges. According to the SEC, Hyperdynamics failed to accurately record certain payments made by its subsidiary based in the Republic of Guinea and also failed to determine whether the company’s subsidiary paid related parties. Last month, Hyperdynamics resolved the FCPA charges by agreeing to pay the SEC $75,000.
In light of the SEC’s increased attention on the FCPA, corporations should focus on strengthening their internal controls and compliance efforts. As the latest enforcement actions highlight, even small violations can lead to costly legal headaches.
How Understanding Bankruptcy Trends Can Benefit Your Business
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
SEC Takes Actions Against Issuers for Failure to File Form D
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
If you purchase real property from a foreign person or entity, you may be required to withhold taxes from your payment to the seller under the Foreign Investment in Real Property Tax Act (FIRPTA). The federal tax law is designed to ensure that foreign sellers pay any applicable capital gains tax on profits realized from […]
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
