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Olympus: May Have Broken U.S. Corruption Law

  • 1.  Olympus: May Have Broken U.S. Corruption Law

    Posted 08-02-2012 11:50 AM
    This message has been cross posted to the following eGroups: Brazil Compliance Professionals and FCPA: Foreign Corrupt Practices Act Forum .
    By Hiroyuki Kachi, Marketwatch, Wall Street Journal

    -- Olympus informed U.S. officials of possible expense accounting issues 'months ago'
    -- Chairman reportedly says 'might agree some violation of Foreign Corrupt Practices Act'
    -- Shares 7% lower, not helped by jitters over investor lawsuit

    TOKYO--In an early test of its avowed intent to enhance regulatory compliance after a multi-billion dollar accounting scandal, Olympus Corp. said it has informed the U.S. Department of Justice of possible expense accounting irregularities in a doctor training program in Brazil that could test the rules of the Foreign Corrupt Practices Act.

    The news was enough to snap investors' brittle confidence in the ability of new management to steer the still-troubled camera and medical equipment maker toward lasting profitability.

    Olympus shares were down by as much as 7% in Tokyo, weighed by the possibility of an impact on the firm's business in the U.S. as well as concerns about a new lawsuit by a shareholder seeking redress for the loss of value in its Olympus holding.

    Triggered by the dramatic resignation of former CEO Michael Woodford last October, admissions by Olympus officials that they covered up $1.5 billion in investment losses landed the firm in one of Japan's biggest corporate scandals in years and generated intense debate about the state of corporate governance in the country.

    An Olympus spokesman Wednesday confirmed a report by Bloomberg quoting chairman Yasuyuki Kimoto as saying his company first raised the Brazil issue with the DOJ "four to five months ago." The potential problem may be related to the way the company handled doctors' expenses for travel, meals or entertainment at a training facility operated by Olympus in Brazil.


    Thank you,

    Eric Newman, Esq., CCEP
    Social Media Manager
    (952) 405-7938
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