Earlier this year, the SEC announced a $4 million FCPA enforcement action against Flutter International (a company headquartered in Ireland) – the successor in interest to The Stars Group (a company that was headquartered in Canada) – based on the finding that the “Company paid approximately $8.9 million to consultants in Russia in support of the Company’s operations and its efforts to have poker legalized in that country.” (See here for the prior post).
The SEC’s order stated:
“By at least 2016, the Company’s Board undertook a review of whether the Company, any of its subsidiaries, or any of its personnel had made improper payments, directly or through external consultants, to government officials in certain foreign jurisdictions. As a result of this review, the Company voluntarily contacted the Commission and other U.S. and Canadian regulators …”.
Recently, a law firm issued this release asserting that the Flutter enforcement action action “was supported by a Whistleblower complaint filed by Seiden Law LLP two years ago on behalf of an anonymous client and represents a significant statement that payments by issuers registered with the SEC outside the US to secure favorable treatment by foreign government officials are within the reach of the SEC and will result in adverse charges.”
It is an interesting assertion given the timeline.
In other words, in 2016 the company conducted an internal review and at some point thereafter “voluntarily contacted” (in the SEC’s words) the SEC and Canadian regulators, yet in 2021 (“two years ago”) a whistleblower complaint “supported” the enforcement action).
But then again, in the recent record-breaking $279 whistleblowing bounty awarded in connection with the Ericsson enforcement action (see here for the prior post), the SEC stated:
“While Claimant 1’s information was important, it was submitted after the Investigation had already been opened and after Staff had already become aware of potential [Redacted] misconduct by the Company Further, Claimant 1’s specific information only related to certain of the conduct that the Commission ultimately charged in the Covered Action.”
