International Business Machines Corp. (NYSE:IBM) announced on Thursday that the U.S Securities and Exchange Commission and the Department of Justice have dropped their investigations in Poland.
The DOJ and the SEC have been investigating IBM’s activities in Poland, specifically bribery allegations. However, the two U.S authorities recently dropped the investigations without any public announcement and no action was taken against the firm. This suggests that the two authorities did not find anything to incriminate the tech company. IBM included the announcement in its quarterly earnings report which it filed with the SEC.
“The DOJ and the SEC each informed IBM that based on the information to date, they closed their respective investigations into these matters without pursuing any enforcement action against the company,” pointed out IBM in the filing.
The announcement has led to more criticism about how the regulatory bodies deal with the details of their investigations. Sometimes they release the details publicly and sometimes they do not. Former U.S. attorney John Wood stated that DOJ does not traditionally make a public announcement when it decides not to prosecute as per the Foreign Corrupt Practices Act. However, the Department of Justice made some policy changes for specific foreign bribery cases here companies voluntarily reveal their wrongdoing and cooperate with the authorities.
The investigation has been running for five years
IBM’s case made its way into the limelight in 2012 after Andrzej Machnacz, an IT official in Poland’s Interior Ministry reportedly received bribes from foreign tech firms including IBM. He reportedly received bribes from the companies in exchange for giving them government contracts.
Polish prosecutors purported that Machnacz received more than $1 million in cash and gifts in exchange for the contract allocation to the tech companies. This is not the first time that the company has been mentioned in such a case. In 2013, a federal Judge authorized IBM’s payment of a $10 million fine involving similar cases in China and South Korea. The company did not admit or deny the charges.
IBM stock closed the latest trading session on Thursday at $145.07 after a 0.20 percent decline from the previous close.
