BENGALURU: Tech firm Oracle has to pay over USD 23 million fine to the US Securities and Exchange Commission (SEC) for violating the Foreign Corrupt Practices Act (FCPA). The act prohibits citizens of the United States and entities from bribing foreign government officials to benefit their business interests.
The company's subsidiaries in Turkey, the UAE and India created and used slush funds to bribe foreign officials in return for business between 2016 and 2019.
In a statement, SEC said that Oracle subsidiaries in Turkey and UAE also used the 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," said Charles Cain, SEC's FCPA Unit Chief.
This is the second time the tech giant has been fined. Previously the SEC sanctioned Oracle in connection with the creation of slush funds. In 2012, Oracle resolved charges relating to the creation of millions of dollars of side funds by Oracle India, which created the risk that those funds could be used for illicit purposes.
"This matter highlights the critical need for effective internal accounting controls throughout the entirety of a company’s operations," Cain said.
Oracle is said to have agreed to cease and desist from committing violations of the anti-bribery, books and records, and internal accounting controls provisions of the FCPA and to pay approximately USD 8 million in disgorgement and a USD 15 million penalty.
The SEC has also appreciated the assistance of the Capital Markets Board of Turkey, Emirates Securities and Commodities Authority, and the Securities and Exchange Board of India.