General Cable said last week in an earnings release that it has set aside an estimated charge of $28 million that it believes the Securities and Exchange Commission likely will disgorge from profits derived from sales tainted by improper payments made in several countries.
As previously disclosed, General Cable said it’s “been reviewing, with the assistance of external counsel, our use and payment of agents in connection with, and certain other transactions involving, our operations in Angola, Thailand, India, China and Egypt.” Its review has focused on payments and gifts made, offered, contemplated or promised by certain employees in one or more of these countries, directly and indirectly, and at various times, to employees of public utility companies and/or other officials of state owned entities that raise concerns under the Foreign Corrupt Practices Act and possibly under the laws of other jurisdictions.
“We have also identified certain other transactions that may raise concerns under the FCPA for which it is at least reasonably possible we may be required to disgorge estimated profits derived therefrom in an incremental aggregate amount up to $33 million,” General Cable said. The current $28 million accrual is for disgorgement only and doesn’t include “the amount of any possible fines, civil or criminal penalties or other relief, any or all of which could be substantial.”
General Cable said that the SEC and Justice Department inquiries into these matters remain ongoing, and that it continues to cooperate with both agencies.