IBM Agrees to Settle Foreign Bribery Allegations for $10 Million

Summary: New York-based International Business Machine Corporation (“IBM”) has agreed to pay $10 million to settle a complaint filed by the Securities and Exchange Commission (“SEC”) alleging that IBM subsidiaries and a majority-owned joint venture provided cash payments and improper gifts, travel and entertainment to foreign government officials in South Korea and China in violation of the Foreign Corrupt Practices Act (“FCPA”). The attached Client Alert examines the complaint against IBM and provides a reminder to global companies with foreign operations that FCPA liability can attach to the parent company for the conduct of employees in foreign subsidiaries and majority-owned joint ventures even if it has no knowledge or reason to know of corrupt activity.