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Qualcomm & United States SEC Settle for $7.5 Million

March 2, 2016 - Written By Daniel Fuller

Despite being at the top of the mobile chip game, Qualcomm has been seeing criticism from a number of sources lately, both international and closer to home. One of the organizations giving Qualcomm some trouble lately has been the United States Securities and Exchange Commission. The SEC made allegations that Qualcomm’s dealings outside of the United States in regards to employment and treatment of government officials did not comply with strict ethical standards set forth in applicable law. Things like paying for travel, offering gifts and hiring the friends and children of state employees or the employees of state-owned entities were on the rap sheet. Qualcomm announced today that they have agreed to pay a civil penalty in the amount of $7.5 million dollars and, in exchange, the matter will be concluded and dropped.

Qualcomm did not confirm or deny the SEC’s report and alleged findings in their announcement, only saying that they had opted to pay the civil penalty to have the case closed quickly and cleanly. Although the case was eligible for a possible criminal investigation, the settlement and agreement to pay the civil penalty with the SEC caused the U.S. Department of Justice to announce their investigation had been closed with no criminal findings and no proceedings on the books. For all intents and purposes, the ordeal is over, but Qualcomm will still be reporting back to the SEC on its continuing efforts to beef up their processes and ensure this sort of thing doesn’t happen again.

Thanks to this snafu, Qualcomm will be doing a lot of close internal monitoring and, to avoid conflicts of interest, no longer hiring anybody who has anything to do with a state employee or an employee of a state-owned organization in any country. The allegations centered around Qualcomm’s dealings in China, with no details disclosed as to any findings elsewhere or the possibility thereof. Although this conflict is safely in the rearview, Qualcomm may still face antitrust regulators in various places, meaning their legal troubles could still be far from over. Qualcomm’s announcement made sure to mention that Qualcomm is “committed to ethical conduct and compliance with all laws and regulations” and will remain so in the future.