We're not in a hole. A lot of companies would like to be in our hole - Scott 'touch'n'feely' McNealy
ENTERPRISE VENDOR Oracle has settled with the US Securities and Exchange Commission (SEC) over foreign bribery allegations.
The SEC had alleged that employees of Oracle's Indian subsidiary cooked the books in order to siphon off $2.2m to grease the palms of local vendors, many of which had no relation to Oracle. Oracle has agreed to pay $2m to settle the SEC's charges.
According to the SEC's complaint, the infraction occurred from 2005 until 2007 at Oracle's Indian operations through which the firm flogs software licences to the Indian government. The firm sold the licences through local distributors, with the distributors keeping excess funds from the sales off Oracle's books.
The SEC claimed that Oracle India employees produced eight invoices for payments to third party vendors ranging from $110,000 to $396,000. From the SEC's investigation, the eight vendors were not on Oracle's approved vendor list nor did they sell any Oracle products.
The third party payments "created the risk" of being used for bribery or embezzlement, the SEC alleged. To illustrate, the SEC used as an example a May 2006 deal between Oracle and India's Ministry of Information Technology and Communications where $151,000 had not been disclosed.
Oracle spokeswoman Deborah Hellinger said, "In 2007, Oracle discovered that a few employees of its Indian subsidiary apparently had directed distributors to maintain side funds in violation of Oracle business practices. Following a thorough investigation, the employees involved were terminated.
"Oracle disclosed the matter to the government and has cooperated with the SEC in its investigation, culminating in today's announcement of a $2M settlement. Oracle has established policies, programs and controls to deter and detect inappropriate conduct that have been recognized among the best in our industry.
"We will continue to maintain a high standard of compliance and accountability for our business around the world."
The SEC said that Oracle will pay the $2m civil penalty but will not have to either admit or deny the allegations. µ
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