WPP fined by US regulator for bribery in India: Reports
According to media reports, the advertising firm did not admit or deny the SEC's charges but agreed to pay the fine
The US Securities and Exchange Commission (SEC) has reportedly said that WPP has agreed to pay $19.2 million in penalties and disgorgement to settle Foreign Corrupt Practices Act (FCPA) violations in India, China, Brazil, Peru, Colombia and Chile. The company has been charged with violating the anti-bribery, books and records, and internal accounting controls provisions.
According to media reports, the advertising firm did not admit or deny the SEC's charges but agreed to pay the fine, the SEC said.
Reports claim that “SEC, in an internal administrative order, said that a WPP majority-owned subsidiary in India paid as much as a million dollars in bribes to Indian officials to obtain and retain government business, resulting in over $5 million in net profit between 2015 – 2017.”
“SEC said that until 2018, WPP implemented an aggressive acquisition strategy to grow its business. As part of its acquisition strategy, WPP acquired a controlling interest in small, localised agencies in high-risk markets, such as India, China, and South America that were previously majority-owned by the local agency’s founder,” media reports quoted SEC as stating.
“WPP often structured these acquisitions to include an earn-out provision, where the parties agreed to defer a portion of the purchasing price until the agency’s founder met future financial goals,” SEC reportedly said.
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