Scientific instruments maker Bruker Corp. has agreed to pay $2.4 million to settle U.S. Securities and Exchange Commission allegations that it made improper payments to Chinese government officials as part of an effort to win business.

The payments made by employees in the China offices of four Bruker subsidiaries totaled about $230,938 and enabled the company to realize approximately $1.7 million in profits from sales contracts with state-owned entities in China, the SEC said.

“Bruker’s lax internal controls allowed employees in its China offices to enter into sham ‘collaboration agreements’ to direct money to foreign officials and send officials on sightseeing trips around the world,” Kara Brockmeyer, chief of the SEC enforcement division’s Foreign Corrupt Practices Act unit, said in a news release.

The Chinese officials’ travel destinations included New York, Los Angeles, the Czech Republic, Norway, Sweden, France, Germany, Switzerland and Italy, the SEC said in an order instituting a settled administrative proceeding. Those officials ”often authorized the purchase of products” from Bruker, the order said.

As part of the settlement, Burker agreed to pay $1,714,852 in disgorgement, $310,117 in prejudgment interest, and a $375,000 penalty. The order found that it violated the internal controls and books and records provisions of the Securities Exchange Act of 1934.

The SEC said Bruker paid more than $111,000 to Chinese government officials under 12 suspicious collaboration agreements contingent on state-owned entities providing research on its products or using them in demonstration laboratories. No research was, in fact, provided to the company and Bruker profited by about $583,112 from contracts improperly obtained from the state-owned entities.

Another $119,710 was paid from 2005 through 2011 to fund 17 trips for Chinese government officials that, according to the SEC, “were for the most part not related to any legitimate business purpose” and were recorded in Bruker’s books and records as business expenses.

The company improperly profited by $1,131,740 from contracts obtained from entities whose officials went on the trips, the SEC said.

Featured image: Thinkstock

, , ,

Leave a Reply

Your email address will not be published. Required fields are marked *