The Securities and Exchange Commission reports that a U.S. medical device company has agreed to pay a $7.8 million penalty to settle charges that it violated the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act.
The SEC found that the company’s internal accounting controls were not sufficient to detect the risk of improper payments in sales of products in India, China, and Kuwait and that the company’s India subsidiary failed to maintain complete and accurate books and records. As a result, the settlement also requires the company to retain an independent compliance consultant to review and evaluate its internal controls, recordkeeping, and anti-corruption policies and procedures relating to the use of dealers, agents, distributors, sub-distributors, and other such third parties that sell on its behalf.
The SEC notes that this is not the first time the company has been charged for these types of violations. Pursuant to an October 2013 settlement it paid a $3.5 million penalty, more than $7.5 million in disgorgement of profits, and more than $2.2 million in interest.
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