Uber Discloses FCPA Investigation in IPO Documents

 

■ ■ ■  April 25, 2019

 

 

On April 11, 2019, Uber Technologies, Inc. (Uber) disclosed, in an SEC filing, an investigation by the U.S. Department of Justice (DOJ) on possible Foreign Corrupt Practices Act (FCPA) violations related to Uber's activities in Asia, including the countries of Indonesia, Malaysia, China, and India. 

 

Uber made such disclosures in its first SEC filing, in connection with the company's initial public offering (IPO) as follows:

 

"We received requests from the DOJ in May 2017 and August 2017 with respect to an investigation into allegations of small payments to police in Indonesia and other potential improper payments in other countries in which we operate or have operated, including in Malaysia, China, and India. The investigation is ongoing, and we are cooperating with the DOJ in this investigation. If we are determined to have violated the FCPA or similar laws, we may be subject to criminal sanctions and other liabilities, which would adversely affect our business, financial condition, and operating results."

 

According to news reports from 2017, the payments made by Uber in Indonesia are "small" payments related to the operation of the company's drivers in areas where commercial carriers were not allowed. In Malaysia, on the other hand, the press reported that, in 2017, Uber was facing investigations over a corporate donation to the Malaysian Global Innovation and Creativity Center, a government-backed accelerator for entrepreneurs, because shortly after, the Malaysian government passed legislation favorable to Uber. However, the DOJ has not yet commented or published a press release on the investigation in connection with Uber's disclosure.  

 

The FCPA violations investigation was not the only legal issue Uber disclosed. The company also mentioned other compliance risks and lawsuits involving unfair competition, trade secrets theft and claims relating to employment status of its drivers. 

 

With the DOJ and SEC's aggressive enforcements efforts and record-setting fines, MDO Partners encourages companies to establish strong Anti-Corruption Compliance Programs to mitigate the risks of FCPA violations. Indeed, recent reports reflect that nearly 500 enforcement actions were initiated and $4 billion in fines levied by the DOJ and SEC in 2018, boosted in large part by foreign corruption cases.  

 

MDO Partners advises companies on global compliance programs. Our attorneys and advisors have extensive experience advising clients on the FCPA and effective Anti-Corruption Compliance Programs in over 30 countries.

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About MDO Partners

 

MDO Partners is a boutique law firm that focuses on Corporate, International, and Real Estate Law, as well as Global Compliance and Business Ethics. The firm is comprised of a solid team of attorneys and advisors with more than 100 years of combined experience who are committed to the business goals and best interests of their clients. The firm delivers value-added services of the highest caliber, and serves as a trusted advisor to its clients with a practical and business-savvy approach. For more information on MDO Partners, please visit www.mdopartners.com

 

If you have questions or comments regarding this Alert, please contact the attorney or advisor listed below.

 

Richard Montes de Oca

Managing Partner

305.704.8452

rmontes@mdopartners.com

 

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