Microsoft to Pay $25 Million to Settle Foreign Bribery Probe

By Dylan Tokar 

Microsoft Corp. agreed to pay $25 million to settle an investigation into potential violations of a law prohibiting the bribery of foreign government officials, the U.S. Securities and Exchange Commission said Monday.

The computer behemoth settled the alleged Foreign Corrupt Practices Act violations by four Microsoft subsidiaries in separate agreements with the SEC and the U.S. Department of Justice and the Securities and Exchange Commission.

Microsoft, as part of its settlement with the SEC, neither admitted nor denied the misconduct described by the agency.

In an internal email to company employees on Monday that was shared with The Wall Street Journal, Microsoft President Brad Smith said the misconduct involved a small number of employees that were no longer with the company.

"We were deeply disappointed and embarrassed when we first learned about these events several years ago, and we hope that all of the steps we've since taken, including today's settlement, send a strong message," Mr. Smith said.

The SEC and Justice Department investigation found that a Microsoft subsidiary in Hungary had used discounts on software licenses to fund bribes intended for foreign officials, the government said. The Hungarian subsidiary has entered into a non-prosecution agreement with the Justice Department, according to the agency.

In Saudi Arabia and Thailand, two other Microsoft subsidiaries provided illegal gifts and travel benefits to government officials through a slush fund, according to the SEC. A Turkish subsidiary illegally provided excessive discounts to a third party without properly recording the transaction, the agency said.

The Wall Street Journal last year reported that U.S. authorities, including the SEC and the Justice Department, were probing Microsoft's software sales in Hungary over potential bribery and corruption allegations.

Write to Dylan Tokar at [e-mail]

(END) Dow Jones Newswires

July 22, 2019 12:13 ET (16:13 GMT)

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