A Canadian clean fuel technology company and its former chief executive officer agreed Friday to pay more than $4.1 million to the SEC to resolve charges that they violated the Foreign Corrupt Practices Act by bribing a government official in China.
Westport Fuel Systems, Inc. of Vancouver will disgorge $2.35 million and pay prejudgment interest of $196,000, plus a civil penalties of $1.5 million.
The former CEO, Nancy Gougarty of Leesville, South Carolina, will pay a civil penalty of $120,000.
The company and Gougarty resolved the SEC enforcement action without admitting or denying the agency’s findings.
In an internal administrative order (pdf), the SEC said Westport, acting through Gougarty and others, bribed a Chinese official “by transferring shares of stock in Westport’s Chinese joint venture to a Chinese private equity fund in which the government official held a financial interest.”
Westport concealed the identity of the Chinese private equity fund in its public filings and books and records, the SEC said.
“Gougarty caused Westport’s violations by circumventing Westport’s internal accounting controls and signing a false certification concerning the sufficiency of those controls.”
Westport first disclosed the FCPA investigation in a July 2017 securities filing, according to FCPA Tracker. The SEC launched an investigation but the DOJ didn’t, according to the company’s filings.
Westport and Gougarty violated the FCPA’s anti-bribery, books and records, and internal controls provisions, the SEC said.
In a statement Friday, Westport said the FCPA settlement relates to a transaction “that took place more than three years ago and was handled by individuals who have since left the Company.”
The SEC said it “considered remedial acts undertaken by Westport concerning its anti-corruption and financial reporting compliance programs, and its cooperation afforded SEC staff.”
Richard L. Cassin is editor at large of the FCPA Blog.