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Qualcomm settles in US over China corruption

by on02 March 2016

“gifts, travel, and entertainment”

Qualcomm has settled charges with the US Securities and Exchange Commission that it hired relatives of Chinese officials who could influence the selection of its mobile technology products.

SEC looked into claims that Qualcomm provided “gifts, travel, and entertainment” to try to influence officials at government-owned telecom companies in China and then covered up the fact by recording that the things of value provided to the officials were legitimate business expense.

The chip company neither accepts nor denies the charges but has agreed to pay US$7.5 million to make the SEC go away. Qualcomm clarified that the settlement relates to its conduct before 2012 and the SEC action was not criminal . The Department of Justice recently closed its investigation on these matters without taking any action, it added.

Qualcomm is said to have provided full-time employment and paid internships to officials’ family members with the aim of obtaining or retaining business in China. The company obliged, for example, an official who asked Qualcomm employees to find an internship for her daughter studying in the U.S., acknowledging in internal communications that her parents “gave us great help for Q.C. new business development,” SEC said.

The company is also charged with providing a $75,000 research grant to a university in the US on behalf of the son of a foreign official so that he could retain his position in its Ph.D. program and renew his student visa.

The company subsequently hired the official’s son as an intern and later made him a permanent employee and sent him on a business trip to China, an opportunity to visit his parents over the Chinese New Year. In addition, a Qualcomm executive personally provided the son of the official with a $70,000 loan to buy a home, according to the SEC.


Last modified on 02 March 2016
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