Edward (Ted) Kang, partner in the firm’s Government & Internal Investigations Group, noted the significance of Goodyear’s $16 million settlement with the U.S. Securities Exchange Commission (SEC) over allegations its subsidiaries violated the Foreign Corrupt Practices Act (FCPA).
“This case should serve as a warning to multinational companies both procedurally and substantively. Procedurally, this case demonstrates the SEC's renewed commitment to bringing FCPA enforcement matters by administrative order rather than through the courts, effectively circumventing meaningful judicial review,” said Kang.
He continued: “Given the clear home court advantage of the administrative process, the SEC will likely continue to use this tool in the future. Substantively, Goodyear ultimately paid for its failure to bring these African companies under the umbrella of Goodyear’s compliance program. This case is thus a reminder that companies will be held accountable for misconduct within even small, distant subsidiaries.”