Analogic, an airport security and medical-imaging technology provider, said this week in a quarterly filing that the Securities and Exchange Commission and the Department of Justice have made separate settlement proposals to resolve a Foreign Corrupt Practices Act case totaling payments of approximately $15 million.
As Compliance Week previously reported, Analogic initially disclosed the potential violations in its annual report for the fiscal year ended July 31, 2011 after discovering certain transactions involving its Danish subsidiary BK Medical, and certain of its foreign distributors, that potentially violated Danish law, the FCPA, and company policies. These included transactions in which the distributors paid BK Medical more than amounts owed, and BK Medical transferred the excess amounts, at the direction of the distributors, to third parties identified by the distributors.
Analogic said it then voluntarily disclosed the matter to the Danish government, the Justice Department, and the SEC and are cooperating with inquiries by these agencies. The company added that it believes these agencies have “substantially completed their investigation into the transactions at issue.”
“We are uncertain whether the Danish government will seek to impose sanctions or penalties against us,” the company in a Dec. 9 securities filing.
During the three months ended Oct. 31, 2015 and 2014, Analogic said it incurred inquiry-related costs of approximately $0.03 million and $0.8 million, respectively, in connection with this matter. “[T]he cost of any settlements or other resolutions of these matters could materially exceed our accruals,” the company said.
In September, Analogic proposed a $1.6 million settlement with the SEC to resolve the FCPA investigation, but the SEC rejected that offer.