Software Company Nearing Settlement Over Chinese Bribery

PTC, a computer software company offering computer-design and engineering products based out of Massachusetts, is reportedly nearing settlement with the SEC and/or DOJ over a government investigation into potential violations of the Foreign Corrupt Practices Act (FCPA). The issues were reportedly discovered during an internal investigation in 2011 and the company self-reported them to the U.S. government.

PTC has reportedly reached an agreement in principle to settle the matter with both agencies. The company has now set aside just over $28 million for settlement according to its securities filings.

The company is covered by the FCPA because its shares are listed on the NASDAQ stock exchange under the symbol PTC. According to their 2014 annual report, they terminated business partners and employees in connection with their investigation and compliance efforts.

The company receives approximately 60 percent of its revenue from outside of the United States. China has historically represented 5 to 7 percent of total revenue as part of the 20 percent of their revenue from the Asia-Pacific region.

China has been the leading country for government and corporate investigations into suspicions of bribery for some time. Much of China’s economic activity takes place as companies that are state-owned enterprises, and as a result their employees are classified as foreign officials under the FCPA. The company’s China operations and business partners in China reportedly made expenditures, including entertainment and travel, that benefited these foreign officials.

Early in the government’s securities whistleblower program, a high ranking official called the FCPA fertile ground for whistleblowers. If you have evidence of bribery by a company listed on a United States stock exchange, or the agent of a U.S. issuer, call 1-800-590-4116 for a free, confidential initial legal consultation with one of our SEC whistleblower attorneys concerning the FCPA.

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