KALAMAZOO — Stryker Corp. agreed to pay a $7.8 million fine to settle federal securities charges of violating laws over internal accounting controls and records for foreign sales.
The Kalamazoo-based Stryker neither denied nor admitted the findings of a U.S. Securities and Exchange Commission investigation that found the company’s internal accounting controls “were not sufficient” to detect risks for improper payments on sales in China, India and Kuwait. The SEC noted Stryker had previously been charged with the same violation in 2013 and paid a total of $13.2 million in penalties for violating the Foreign Corrupt Practices Act.
Under the latest settlement, Stryker agreed to hire an independent compliance consultant to “review and evaluate its internal controls, record-keeping, and anti-corruption policies and procedures relating to use of dealers, agents, distributors, sub-distributors, and other such third parties that sell on behalf of Stryker,” according to the SEC.
“Stryker’s failures to implement sufficient internal accounting controls and keep accurate books and records are unacceptable, especially as this is not the first time the company has been charged for these types of violations,” Marc Berger, director of the SEC’s New York Regional Office, said in a statement. “The penalty ordered along with the imposition of a compliance consultant are appropriate and necessary.””
The settlement noted that the company cooperated with the SEC investigation, retained outside counsel for an internal investigation of its compliance with the law, “undertook a number of remedial effort,” and “fortified its existing compliance program, which is designed to prevent, detect, and remediate potential misconduct.”