US-based Cognizant incurred $27 million in costs related to its investigation into potential "improper payments" made in India and related lawsuits last year and expects the expenses to continue this year as well.
US-based Cognizant incurred $27 million in costs related to its investigation into potential “improper payments” made in India and related lawsuits last year and expects the expenses to continue this year as well.
In September 2016, Cognizant had disclosed that it had discovered violations of the US Foreign Corrupt Practices Act.
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To date, the investigation has identified a total of about $6 million in payments made between 2010 and 2015 in “potentially improper payments” for company-owned facilities in India.
“In 2016, we incurred $27 million in costs related to the FCPA investigation and related lawsuits. We expect to continue to incur expenses related to these matters in 2017 and future periods,” Cognizant said in a filing to the US SEC.
Since the disclosure, three putative securities class action complaints have been filed in a US District Court seeking awards of compensatory damages, among other relief, and their costs and attorneys’ and experts’ fees.
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Cognizant said it is “presently unable to predict the duration, scope or result of the internal investigation, any investigations by the Department of Justice (DOJ) or the SEC, the consolidated putative securities class action, the consolidated putative shareholder derivative action or any other lawsuits”.