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General Cable Discloses Reserve for Potential Disgorgement to SEC over FCPA
Recently, General Cable Corp. disclosed in an 8-K/A that it had accrued a $24 million reserve related to potential disgorgement the company anticipates having to pay the SEC related to an investigation of its sales activities in Angola. The reserve did not include any provision for potential fines or penalties. General Cable previously announced both the inception and near resolution of its internal investigation into potential FCPA concerns in Angola, Thailand, India, and Portugal (see prior FCPA Scorecard coverage).
General Cable Announces FCPA Internal Investigation Near Completion
Just a month after announcing its internal investigation of possible FCPA violations, news reports indicate that General Cable Corporation's review will be completed or substantially completed by the first quarter of 2015. The company also announced that it "plans to exit all of its Asia Pacific and African manufacturing operations," although it did not link the exit — which affects nine plants in Asia and five plants in Africa, and approximately 17% of its total sales — to its FCPA investigation. In September, the Kentucky-based cable manufacturer announced that it was investigating its payment practices with respect to employees of public utility companies in Angola, Thailand, India and Portugal due to possible FCPA concerns. News reports indicate that, to date, the company has spent millions on the review, which has included a review of over 450,000 documents and interviews of over 20 individuals. The company also disclosed that it was cooperating with investigations by the DOJ and SEC.
General Cable Investigates its Angola, Thailand, Indian, and Portugal Operations
In a Form 8-K filed on September 22, General Cable Corporation stated that it is reviewing its payment practices with respect to employees of public utility companies in Angola, Thailand, India and Portugal due to possible FCPA concerns. The cable manufacturer, which is based in Kentucky, determined that "certain employees in [its] Portugal and Angola subsidiaries directly or indirectly made payments at various times from 2002 through 2013 to officials of Angola government-owned public utilities that raise concerns under the FCPA and possibly under the laws of other jurisdictions." The investigation also covers General Cable's use and payment of agents in Thailand and India, which the company also believes may have implications under the FCPA or other laws. According to General Cable's filing, it voluntarily disclosed the issues to the SEC and the DOJ, whose investigations are ongoing.