The Securities and Exchange Commission today announced that Westport Fuels Systems, Inc., a Canadian “clean fuel technology” company headquartered in Vancouver, Canada, and its former chief executive officer, Nancy Gougarty, of Leesville, South Carolina, have agreed to pay more than $4.1 million to resolve charges that they violated the Foreign Corrupt Practices Act (FCPA) by paying bribes to a foreign government official in China.
According to the SEC’s order, beginning no later than 2016, Westport, acting through Gougarty and others, engaged in a scheme to bribe a Chinese government official to obtain business and a cash dividend payment by transferring shares of stock in Westport’s Chinese joint venture to a Chinese private equity fund in which the government official held a financial interest.
The order also says that Westport concealed the identity of the Chinese private equity fund in its public filings, as well as in its books and records, by falsely identifying a different entity as the counterparty to the transaction.
Gougarty caused Westport’s violations by evading Westport’s internal accounting controls and signing a false certification concerning the adequacy of those controls.
“A company’s commitment to compliance is only as strong as the effort put in by senior management,” said Charles Cain, Chief of the SEC Enforcement Division’s FCPA Unit. “Here, the chief executive exploited weaknesses in the company’s controls to engage in bribery, undermining shareholder interests.”
The SEC’s order finds that respondents violated the anti-bribery, books and records, and internal controls provisions of the Securities Exchange Act of 1934 and that Gougarty caused certain of Westport’s violations. Without admitting or denying the SEC’s findings, respondents consented to a cease-and-desist order. Westport also agreed to pay $2,546,000 in disgorgement and prejudgment interest and a civil penalty of $1,500,000, and Gougarty agreed to pay a civil penalty of $120,000.
In determining to accept Westport’s offer, the SEC considered remedial acts undertaken by Westport concerning its anti-corruption and financial reporting compliance programs, and its cooperation with SEC staff.
About Ken Zino
Ken Zino, editor and publisher of AutoInformed, is a versatile auto industry participant with global experience spanning decades in print and broadcast journalism, as well as social media. He has automobile testing, marketing, public relations and communications experience. He is past president of The International Motor Press Assn, the Detroit Press Club, founding member and first President of the Automotive Press Assn. He is a member of APA, IMPA and the Midwest Automotive Press Assn.
He also brings an historical perspective while citing their contemporary relevance of the work of legendary auto writers such as Ken Purdy, Jim Dunne or Jerry Flint, or writers such as Red Smith, Mark Twain, Thomas Jefferson – all to bring perspective to a chaotic automotive universe.
Above all, decades after he first drove a car, Zino still revels in the sound of the exhaust as the throttle is blipped during a downshift and the driver’s rush that occurs when the entry, apex and exit points of a turn are smoothly and swiftly crossed. It’s the beginning of a perfect lap.
AutoInformed has an editorial philosophy that loves transportation machines of all kinds while promoting critical thinking about the future use of cars and trucks.
Zino builds AutoInformed from his background in automotive journalism starting at Hearst Publishing in New York City on Motor and MotorTech Magazines and car testing where he reviewed hundreds of vehicles in his decade-long stint as the Detroit Bureau Chief of Road & Track magazine. Zino has also worked in Europe, and Asia – now the largest automotive market in the world with China at its center.
SEC Charges Westport Fuels Systems and ex-CEO with Bribing a Chinese Government Official via a Private Equity Fund
The Securities and Exchange Commission today announced that Westport Fuels Systems, Inc., a Canadian “clean fuel technology” company headquartered in Vancouver, Canada, and its former chief executive officer, Nancy Gougarty, of Leesville, South Carolina, have agreed to pay more than $4.1 million to resolve charges that they violated the Foreign Corrupt Practices Act (FCPA) by paying bribes to a foreign government official in China.
According to the SEC’s order, beginning no later than 2016, Westport, acting through Gougarty and others, engaged in a scheme to bribe a Chinese government official to obtain business and a cash dividend payment by transferring shares of stock in Westport’s Chinese joint venture to a Chinese private equity fund in which the government official held a financial interest.
The order also says that Westport concealed the identity of the Chinese private equity fund in its public filings, as well as in its books and records, by falsely identifying a different entity as the counterparty to the transaction.
Gougarty caused Westport’s violations by evading Westport’s internal accounting controls and signing a false certification concerning the adequacy of those controls.
“A company’s commitment to compliance is only as strong as the effort put in by senior management,” said Charles Cain, Chief of the SEC Enforcement Division’s FCPA Unit. “Here, the chief executive exploited weaknesses in the company’s controls to engage in bribery, undermining shareholder interests.”
The SEC’s order finds that respondents violated the anti-bribery, books and records, and internal controls provisions of the Securities Exchange Act of 1934 and that Gougarty caused certain of Westport’s violations. Without admitting or denying the SEC’s findings, respondents consented to a cease-and-desist order. Westport also agreed to pay $2,546,000 in disgorgement and prejudgment interest and a civil penalty of $1,500,000, and Gougarty agreed to pay a civil penalty of $120,000.
In determining to accept Westport’s offer, the SEC considered remedial acts undertaken by Westport concerning its anti-corruption and financial reporting compliance programs, and its cooperation with SEC staff.
About Ken Zino
Ken Zino, editor and publisher of AutoInformed, is a versatile auto industry participant with global experience spanning decades in print and broadcast journalism, as well as social media. He has automobile testing, marketing, public relations and communications experience. He is past president of The International Motor Press Assn, the Detroit Press Club, founding member and first President of the Automotive Press Assn. He is a member of APA, IMPA and the Midwest Automotive Press Assn. He also brings an historical perspective while citing their contemporary relevance of the work of legendary auto writers such as Ken Purdy, Jim Dunne or Jerry Flint, or writers such as Red Smith, Mark Twain, Thomas Jefferson – all to bring perspective to a chaotic automotive universe. Above all, decades after he first drove a car, Zino still revels in the sound of the exhaust as the throttle is blipped during a downshift and the driver’s rush that occurs when the entry, apex and exit points of a turn are smoothly and swiftly crossed. It’s the beginning of a perfect lap. AutoInformed has an editorial philosophy that loves transportation machines of all kinds while promoting critical thinking about the future use of cars and trucks. Zino builds AutoInformed from his background in automotive journalism starting at Hearst Publishing in New York City on Motor and MotorTech Magazines and car testing where he reviewed hundreds of vehicles in his decade-long stint as the Detroit Bureau Chief of Road & Track magazine. Zino has also worked in Europe, and Asia – now the largest automotive market in the world with China at its center.