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Stryker discloses new FCPA investigation after two prior enforcement actions

Medical device-make Stryker Corporation — which resolved FCPA cases in 2013 and 2018 — said Tuesday in an SEC filing that it is “currently investigating whether certain business activities in a foreign country violated provisions of the Foreign Corrupt Practices Act.”

Stryker, based in Kalamazoo, Michigan, said it has “engaged outside counsel to conduct” the new investigation.

In 2018, Stryker paid the SEC a $7.8 million penalty to resolve FCPA books and records and internal accounting controls offenses in India, China, and Kuwait.

Stryker agreed to the settlement without admitting or denying the SEC’s findings.

The SEC said Stryker’s internal accounting controls weren’t sufficient “to detect the risk of improper payments in sales of Stryker products” in the three countries.

In an SEC enforcement action in 2013, Stryker paid $13.2 million to resolve FCPA violations in Argentina, Greece, Mexico, Poland, and Romania, where it bribed doctors and administrators at government-controlled hospitals.

Stryker wasn’t required to make any admission of guilt regarding the SEC’s findings.

But as part of that action, the SEC ordered Stryker to retain an independent compliance consultant.

The consultant’s role was to review and evaluate Stryker’s internal controls, record-keeping, and anti-corruption policies and procedures “relating to its use of dealers, agents, distributors, sub-distributors, and other intermediaries” that sell on its behalf.

In Tuesday’s disclosure posted by FCPA Tracker, Stryker didn’t specify what countries are involved.

But the company said it has been contacted by the SEC and DOJ and is cooperating with those agencies.

“At this time we are unable to predict the outcome of the investigation or the potential impact, if any, on our financial statements,” Stryker said.

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