Stay up-to-date with the latest developments in securities law through access to both news and all statutes and regulations. Find relevant corporate filings through a searchable EDGAR database. And...
Sept. 28 — Multinational electronic manufacturer Hitachi, Ltd., without admitting or denying wrongdoing, agreed to pay $19 million to resolve Securities and Exchange Commission allegations it inaccurately recorded improper payments to South Africa’s ruling political party, in violation of the Foreign Corrupt Practices Act.
Allegedly, Hitachi sold a 25-percent interest in a South African subsidiary to Chancellor House Holdings (Pty) Ltd., a company that served as a front for the African National Congress. Hitachi then encouraged Chancellor to use its political influence to help obtain government contracts from a public utility owned and operated by the South African government, the SEC said in its Sept. 28 release.
Under the arrangement, Chancellor and the ANC were able to share in the profits from any power station contracts that Hitachi secured, the SEC said.
The agency alleged that Hitachi paid Chancellor approximately $5 million in “dividends” based on profits derived from two contracts to build power stations in South Africa. Separately, Hitachi also paid Chancellor an additional $1 million in “success fees” for using its influence during a tender process and then inaccurately booked them as consulting fees, the SEC said.
The commission alleged that Hitachi’s misconduct violated the books and records and internal accounting controls provisions of the federal securities laws.
“Hitachi’s lax internal control environment enabled its subsidiary to pay millions of dollars to a politically-connected front company for the ANC to win contracts with the South African government,” SEC enforcement director Andrew J. Ceresney said in the release. “Hitachi then unlawfully mischaracterized those payments in its books and records as consulting fees and other legitimate payments.”
In addition to paying a $19 million civil penalty, Hitachi also agreed to be permanently enjoined from similar future violations.
Hitachi was represented by Linda Chatman Thomsen of Davis Polk, New York and Washington.
To contact the reporter on this story: Antoinette Gartrell in Washington at email@example.com
To contact the editor responsible for this story: Phyllis Diamond at firstname.lastname@example.org
To see the complaint, visit: http://www.bloomberglaw.com/public/document/SECURITIES_AND_EXCHANGE_COMMISSION_v_HITACHI_LTD_Docket_No_115cv0.
To see the proposed final judgment, visit:http://www.bloomberglaw.com/public/document/SECURITIES_AND_EXCHANGE_COMMISSION_v_HITACHI_LTD_Docket_No_115cv0/1.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)