Stryker Corp. (SYK:US), the second-largest seller of orthopedic devices, will pay more than $13.2 million to settle U.S. regulatory claims that subsidiaries paid bribes in five countries to gain or retain business.
Subsidiaries of Stryker in Argentina, Greece, Mexico, Poland and Romania made a total of $2.2 million of “illicit payments” as far back as 2003 that were booked as legitimate expenses, the Securities and Exchange Commission said today in a statement announcing settlement of its administrative case.
“Stryker’s misconduct involved hundreds of improper payments over a number of years during which the company’s internal controls were fatally flawed,” Andrew M. Calamari, director of the SEC’s New York office, said in the statement.
The company’s actions, which the SEC said violated the Foreign Corrupt Practices Act, included a Greek subsidiary’s $200,000 payment to a doctor that was disguised as a donation to a local university, according to the statement. Stryker was also accused of paying travel expenses of foreign officials for trips that lacked any legitimate business purpose, the SEC said.
Stryker, which reaped $7.5 million in illicit profits, will pay about that amount in disgorgement, plus $2.28 million in interest and a $3.5 million fine, the SEC said. The Kalamazoo, Michigan-based company resolved the agency’s claims without admitting or denying wrongdoing.
Matthew Kipp, an attorney for Stryker at Skadden Arps Slate Meagher & Flom LLP in Chicago, didn’t immediately return a telephone call seeking comment.
To contact the reporter on this story: Keri Geiger in New York at email@example.com
To contact the editors responsible for this story: David Scheer at firstname.lastname@example.org; Christine Harper at email@example.com