Oracle to pay $23M to settle foreign bribery charges brought by SEC
Oracle Corp. has agreed to pay $23 million to resolve charges from the U.S. Securities and Exchange Commission that it violated provisions of the Foreign Corrupt Practices Act.
According to the regulator, Oracle subsidiaries in Turkey, the United Arab Emirates and India used slush funds to bribe foreign officials in return for business between 2016 and 2019.
Without either admitting or denying the SEC’s findings, Oracle has signed a cease and desist agreement that says it will not violate anti-bribery law. It has also agreed to pay $8 million in interest and a civil penalty of $15 million.
Oracle in December acquired Cerner for $28.3 billion, which operates the Millennium platform at the center of the Department of Veterans Affairs’ troubled electronic health record modernization program.
According to the SEC, its investigation also found that Oracle subsidiaries in Turkey and UAE had used slush fund money to pay for foreign officials to attend tech conferences in violation of Oracle policies and procedures. In some instances employees of the Turkey subsidiary used the funds for the officials’ families to accompany them on international conferences or to take side trips to California, the regulator argued in order documents.
It is the second time the SEC has sanctioned Oracle in connection with the creation of slush funds. In 2012, the company resolved charges relating to the creation of millions of dollars of side funds by Oracle
SEC Foreign Corrupt Practices Act Unit Chief Charles Cain said: “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.”
“This matter highlights the critical need for effective internal accounting controls throughout the entirety of a company’s operations,” he added.
Commenting on the settlement, Oracle Corporate Communications Vice President Michael Egbert said: “The conduct outlined by the SEC is contrary to our core values and clear policies, and if we identify such behavior, we will take appropriate action.”
Editor’s note, Sept. 27, 2022: This story was updated to include comment from Oracle Corp.