IBM settlement over China bribery claims approved
Allegations against Korea also covered by agreement after US judge signs off on deal
IBM's two-year-old settlement of accusations of bribery on the mainland and South Korea has won US federal court approval as the company faces new scrutiny for possible pay-offs in other countries.
In Washington on Thursday, US District Judge Richard Leon signed off on the US$10 million agreement between IBM and the US Securities and Exchange Commission initially submitted in March 2011. Leon had earlier refused to approve the deal until the company agreed to file reports to him and the regulator on its possible wrongdoing.
During a 10-minute hearing, Leon said he was satisfied IBM "has learned its lesson and is moving in the right direction to ensure this never happens again". If there was another violation in the next two years, "it won't be a happy day", he told company officials.
The approval came almost three months after IBM disclosed that the US Department of Justice was investigating whether it violated the Foreign Corrupt Practices Act (FCPA) in connection with contracts in Poland, Argentina, Bangladesh and Ukraine. IBM said in an SEC filing it was notified of the probes by the department in April and asked to provide information on its global anti-corruption compliance programme. IBM said it was co-operating.
In the final judgment signed by Leon, IBM agreed to make annual reports to the judge and the SEC.
IBM spokeswoman Whitney Forster said it was pleased the settlement had been approved.
The SEC case involved allegations that IBM bribed mainland and South Korean officials to win at least US$54 million in government contracts between 1998 and 2009. The company, without admitting or denying wrongdoing, agreed to US$10 million in disgorgement and penalties.