Nortek Settles FCPA Investigation Over Payments to Chinese Government Officials

Nortek Settles FCPA Investigation Over Payments to Chinese Government Officials

June 13, 2016, Covington Alert

On June 7, 2016, the Securities and Exchange Commission (“SEC”) announced a non-prosecution agreement (“NPA”) with Nortek, Inc., a manufacturer of construction and remodeling products, in connection with an investigation into possible violations of the books and records and internal accounting controls provisions of the US Foreign Corrupt Practices Act (“FCPA”) based on payments by its an indirect wholly-owned Chinese subsidiary to Chinese government officials. Under the NPA, Nortek agreed to pay over $320,000 in disgorgement and pre-judgment interest, but Nortek was not charged with violating the FCPA and did not have to pay additional penalties. Additionally, as part of its recently announced enforcement pilot program, the US Department of Justice (“DOJ”) issued a letter of declination to Nortek closing its inquiry into the matter.