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- Export Control Sanctions and Customs Enforcement
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Telecommunications Company Fined $12 Million for FCPA Violations
On August 29, 2019, The Securities and Exchange Commission (SEC) instituted cease-and-desist proceedings against California based Juniper Networks, Inc. (Juniper) following Juniper's submission of an Offer of Settlement to resolve the SEC's investigation of violations of the Books and Records provision of the U.S. Foreign Corrupt Practices Act (FCPA). In addition to agreeing to cease-and-desist any conduct that violates the FCPA, Juniper agreed to pay $4,000,000 in disgorgement, more than $1,200,000 in prejudgment interest, and $6,500,000 in civil penalties.
Specifically, the SEC alleged that employees of the Russian representative office of Juniper's subsidiary, JNN Development Corporation (JNN) agreed with third party channel providers to increase the discount of its products without passing along that discount to the customers. Rather, the SEC alleged, that delta was used to create a "common fund' that, inter alia, the third party channel providers used to reimburse government officials for travel and entertainment expenses at least some of which had no discernible business purpose. Separately, the SEC also alleged that certain sales employees of Juniper's Chinese subsidiaries falsified trip and meeting agendas to understate the true value of the entertainment that was provided and that, contrary to Juniper's travel policies, the company's legal department approved numerous trips without adequate review and after the travel had occurred.
As previously reported by Red Notice, in February 2018 Juniper disclosed that the Department of Justice (DOJ) advised that it was closing its investigation of the company without taking any further action.
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