San Diego-based Qualcomm said this week it has discovered ‘instances in which special hiring consideration, gifts or other benefits . . . were provided to several individuals associated with Chinese state-owned companies or agencies.’
The discoveries were made in connection with ongoing DOJ and SEC investigations, the company said.
It said it ‘believes the aggregate monetary value of the benefits in question to be less than $250,000, excluding employment compensation.’
A whistleblower complaint triggered Qualcomm’s investigation, which started in 2010.
Qualcomm provides wireless technology and services.
It operates primarily in China, South Korea, Taiwan, Japan, and the United States.
Here’s the full FCPA disclosure from the Form 10-Q filed with the SEC on July 24 by Qualcomm Incorporated:
On September 8, 2010, the Company was notified by the SEC’s Los Angeles Regional office of a formal order of private investigation. The Company understands that the investigation arose from a “whistleblower’s” allegations made in December 2009 to the audit committee of the Company’s Board of Directors and to the SEC. In 2010, the audit committee completed an internal review of the allegations with the assistance of independent counsel and independent forensic accountants. This internal review into the whistleblower’s allegations and related accounting practices did not identify any errors in the Company’s financial statements. On January 27, 2012, the Company learned that the U.S. Attorney’s Office for the Southern District of California/Department of Justice (collectively, DOJ) had begun a preliminary investigation regarding the Company’s compliance with the Foreign Corrupt Practices Act (FCPA). The Company believes that FCPA compliance had also become a focus of the SEC investigation. The audit committee has commenced an internal review into the Company’s compliance with the FCPA with the assistance of independent counsel and independent forensic accountants.
The Company has discovered, and as a part of its ongoing cooperation with these investigations has informed the SEC and the DOJ of, instances in which special hiring consideration, gifts or other benefits (collectively, benefits) were provided to several individuals associated with Chinese state-owned companies or agencies. Based on the facts currently known, the Company believes the aggregate monetary value of the benefits in question to be less than $250,000, excluding employment compensation. The Company is continuing to investigate the circumstances relating to providing these benefits and is attempting to identify whether any other benefits were provided.
The Company is continuing to cooperate with the SEC and the DOJ, but is unable to predict the outcome of their investigations.
Richard L. Cassin is the Publisher and Editor of the FCPA Blog. He can be contacted here.
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