Settlements

ST-488
PTC Inc.
PTC Inc.
United States
Securities and Exchange Commission
China
2016
2/16
Unknown
Legal Person
Civil
Cease and Desist Order
Disgorgement of Profit; Prejudgment Interest
$13,622,000
$11,858,000
$1,764,000
$0
$0
NA
Art.16
Art. 1, Art. 8
Bribery of Foreign Officials; Falsification of books and records; Internal controls violations
No admission or denial of alleged offenses
Yes
According to the SEC Press Release, PTC Inc., a Needham, Massachusetts based technology company, consented to the Cease and Desist Order. According to the SEC, "From at least 2006 into 2011, two wholly-owned PTC subsidiaries (collectively, “PTC-China”) provided improper payments totaling nearly $1.5 million to government officials (“Chinese government officials” or “officials”) who were employed by Chinese state owned entities (“SOEs”) that were PTC customers. These payments were made to obtain or retain business from the SOEs. Specifically, PTC-China provided non-business travel, primarily sightseeing and tourist activities, as well as improper gifts and entertainment, to the Chinese government officials. PTC earned approximately $11.85 million in profits from sales contracts with SOEs whose officials received the improper payments. 2. PTC-China made these improper payments in two primary ways: 1) by providing at least $1,179,912 to third party agents, disguised as commission payments or sub-contracting fees, which were then used to pay for non-business related foreign travel for Chinese government officials; and 2) by allowing its sales staff to provide Chinese government officials with gifts and excessive entertainment of over $274,313. The payments were recorded as legitimate commissions and business expenses in PTC-China’s books and records, when in fact they were improper payments designed to benefit the Chinese government officials. PTC-China’s books and records were consolidated into PTC’s books and records, thereby causing PTC’s books and records to be inaccurate. PTC failed to devise and maintain an adequate system of internal accounting controls sufficient to prevent and detect these improper payments that occurred over several years." (Source: US Securities and Exchange Commission, In the Matter of PTC Inc., Administrative Proceeding File No. 3-17118, February 16, 2016, Summary.)