The US Securities and Exchange Commission (SEC) said employees of Oracle at its India unit used an excessive discount scheme linked to a deal with a carrier owned by the Ministry of Railways.
The US Securities and Exchange Commission (SEC) has fined the tech giant Oracle more than $23 million for violating the Foreign Corrupt Practices Act (FCPA). Oracle used loose money to bribe officials in India, the United Arab Emirates and Turkey for business between 2016 and 2019, according to SEC.
“Creating funds that are not on the books inherently leads to the risk of these funds being used improperly, which is exactly what has happened here at Oracle affiliates in Turkey, UAE and India,” said Charles Keane, Head of SEC’s Foreign Corrupt Practices Law Unit at SEC, “This matter highlights the critical need for effective internal accounting controls across the company’s overall operations.”
Oracle agreed to pay $8 million in damages, with the remaining $15 million in fines out of a total of $23 million, according to the Securities and Exchange Commission. Although it did not admit or deny any wrongdoing in agreeing to the settlement.
“The conduct identified by the Securities and Exchange Commission is contrary to our core values and our clear policies, and if we identify such conduct, we will take appropriate action,” Oracle spokesperson Michael Egbert said. Reuters news agency.
Oracle employees at its India unit used an excessive discount scheme linked to a deal with a carrier owned by the Ministry of Railways, according to the SEC. The market watchdog added that employees offered a massive 70% discount on software deals to keep competitors out.
The SEC Find out that there is no competition as the Indian Ministry of Railways procurement website clearly ordered the use of Oracle products for the project. According to an order from the Securities and Exchange Commission (SEC), an employee involved in the transaction kept a spreadsheet indicating the availability of a reserve of $67,000 for potential payments to Indian officials of the state-owned company (SOE).
“A total of about $330,000 was transferred to a reputable entity to pay the salaries of SOE officials, and another $62,000 was paid to an entity controlled by the sales personnel responsible for the transaction,” the order read.
This is the second time that Oracle has been charged by the Securities and Exchange Commission for bribing officials in India.
In 2012, an Oracle unit in India was found guilty of holding unauthorized side funds with distributors from 2005 to 2007. Oracle agreed to pay $2 million to settle SEC charges of violating provisions of the Foreign Corrupt Practices Act.