Big corruption surfaced in Indian railway, Oracle bribed US$400,000

US tech giant Oracle Corporation will pay a $23 million fine to settle charges brought by the US Securities and Exchange Commission (SEC) for allegedly bribing foreign officials in India, Turkey and the United Arab Emirates.

As per Moneylife reports, Oracle Corporation paid a bribe to Ministry of Railways officials of more than US$400,000 in 2019. It was bribed during the tenure of Union Minister Piyush Goyal.

The Texas-based software company has been charged with violating the Foreign Corrupt Practices Act (FCPA) by using off-the-books kickback funds to bribe officials in order to win business. between 2016 and 2019.

These bribe funds were also used to provide other benefits, such as paying foreign officials to attend technology conferences around the world, in violation of internal Oracle policies, the SEC order says. Read the full order copy here.

Under the Foreign Corrupt Practices Act, it is illegal for US companies to bribe companies abroad. With the settlement charges option, this no longer seems like a barrier. In 2019, Cognizant Technology Solutions Corporation was bribed for its projects in Pune and Chennai with Larsen & Toubro acting as facilitator.

In the case of Oracle, an order was issued on September 22. The SEC says: “One of the sales employees involved in the transaction maintained a spreadsheet indicating that $67,000 was the 'buffer' available to make payments to a specific Indian SOE official.

A total of approximately $330,000 was channelled to an entity with a reputation for paying officials of state-owned companies and another $62,000 was paid to an entity controlled by the sales employees responsible for the transaction.

According to the SEC, Oracle India sales employees also used an excessive discount scheme in connection with a transaction with the Indian SOE in 2019. The offer would be lost without a 70% discount on the software component of the offer. Due to the size of the discount, Oracle required an employee based in France to approve the request.

The Oracle designee provided discount approval without requiring the sales employee to provide further documentary support for the request. In fact, the Indian SOE's publicly available procurement website indicated that Oracle India did not face competition because it had mandated the use of Oracle products for the project,” the order says.

The tech giant agreed to pay a $15 million civil penalty and about $7.9 million of repayment and interest. However, he neither admitted nor denied the SEC's conclusions.

Oracle has also agreed to cease and desist from committing or causing any violation of the anti-bribery, books and records, and internal accounting controls provisions of the FCPA.

In 2012, Oracle agreed to pay a $2 million fine to settle SEC charges related to the creation of millions of dollars in unauthorized secondary funds by Oracle India between 2005 and 2007.

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