Securities and Exchange Commission (SEC) officials reached a settlement with Oracle Corp. to resolve charges the company violated Foreign Corrupt Practices Act (FCPA) provisions.
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According to the SEC, without admitting or denying the SEC’s findings, Oracle agreed to cease and desist from committing violations of the anti-bribery, books and records and internal accounting controls provisions of the FCPA and pay approximately $8 million in disgorgement along with a $15 million penalty.
The SEC order alleges Oracle subsidiaries in Turkey, the United Arab Emirates (UAE) and India created and used slush funds to bribe foreign officials in return for business between 2016 and 2019 – with firm subsidiaries in Turkey and UAE deploying slush funds to pay for foreign officials to attend technology conferences in violation of Oracle policies and procedures.
“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,” SEC FCPA Unit Chief Charles Cain said. “This matter highlights the critical need for effective internal accounting controls throughout the entirety of a company’s operations.”
The SEC alleges that in some instances employees of the Turkey subsidiary used funds for the officials’ families to accompany them on international conferences or take side trips to California.