SEC subpoena for Flowserve in bribery investigation
Tuesday, August 4, 2015 at 9:28AM
Richard L. Cassin in Flowserve, France, Holland, Oil For Food, Subpoena

Image courtesy of FlowserveTexas-based Flowserve Corporation said in a securities filing Thursday that it recently received a subpoena from the SEC in an investigation of possible violations of the FCPA.

The company said an employee of an overseas subsidiary was fired because of actions that violated Flowserve's code of business conduct and may have violated the FCPA.

Flowserve makes industrial pumps for the oil and gas and chemical industries.

The company said it completed its internal investigation and "self-reported the potential violation" to the DOJ and SEC.

It didn't disclose other details about the potential FCPA violation.

In 2008, Flowserve paid $10.5 million to resolve criminal and civil charges that included FCPA violations by French and Dutch subsidiaries.

The company admitted making illegal payments under the U.N. Oil for Food Program.

The SEC settlement included disgorgement and interest of $3.5 million and a civil penalty of $3 million.

The DOJ resolution included a criminal fine of $4 million and a three-year deferred prosecution agreement.

Flowserve has more than 16,000 employees in about 50 countries.

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Here's the full FCPA disclosure from Flowserve Corporation's Form 10-Q filed with the SEC on July 30, 2015:

As previously disclosed in our 2014 Annual Report, we terminated an employee of an overseas subsidiary after uncovering actions that violated our Code of Business Conduct and may have violated the Foreign Corrupt Practices Act.

We have completed our internal investigation into the matter, self-reported the potential violation to the United States Department of Justice (the “DOJ”) and the SEC, and are continuing to cooperate with the DOJ and SEC. 

We recently received a subpoena from the SEC requesting additional information and documentation related to the matter and are in the process of responding. 

We currently believe that this matter will not have a material adverse financial impact on the Company, but there can be no assurance that the Company will not be subjected to monetary penalties and additional costs. 

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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