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Johnson Controls to pay $14.4 million to SEC in FCPA case

Jaclyn Jaeger | July 12, 2016

Johnson Controls, a diversified technology and industrial services provider, this week entered into a $14.4 million settlement with the SEC to resolve violations of the books and records and internal controls provisions of the Foreign Corrupt Practices Act with respect to the company’s operations in China. JCI’s quick response, however, resulted in a declination with the Department of Justice.

According to the SEC’s administrative proceeding, from 2007 to 2013, the managing director and approximately 18 employees of China Marine made payments to sham vendors, some of which were then used to make improper payments of approximately $4.9 million to employees of Chinese government-owned shipyards, and ship-owners and others, to obtain and retain business, as well as to personally enrich China Marine employees.

The improper vendor payments were improperly recorded on

JCI’s books and records, and...

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