Tyco has agreed to dish out $50 million to settle federal securities charges regarding the company’s alleged participation in a $1 billion-plus accounting fraud scandal and violation of anti-bribery regulations, ending the long-running legal dispute that jailed its former top executives, The Wall Street Journal reports.
Though Tyco did not admit any illegal action on its part, the company said it would refrain from committing any additional accounting fraud and pay a dollar disgorgement fee as well as a $50 million charge as punishment, according to The Journal.
The settlement puts an end to Tyco’s regulatory issues; however, a company spokesperson told The Journal that it still faces “active litigation” on the behalf of shareholders.
In May, Tyco logged a charge in the amount of $50 million, which it said would be used to settle the Securities and Exchange Commission charges, according to The Journal, but that case dragged on for almost a year because the SEC couldn’t come to an agreement on when corporations involved in financial fraud should be penalized and because it was still finalizing a list of what should be considered when those fines are handed down.
The new guidelines, released in January, indicate the SEC should consider a number of points before issuing fines, including how shareholders benefited from a specific fraud and how a given penalty would affect those shareholders, The Journal reports.
The SEC complaint charges Tyco with falsely boosting its financial statement by upward of $1 billion between 1996 and 2002, according to The Journal.
Check out our CIO News Alerts and Tech Informer pages for more updated news coverage.