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Stericycle Accrues $61 Million For Future FCPA (And Related) Settlements


Even though the DOJ and SEC have long talked about the importance of prompt Foreign Corrupt Practices Act investigations (for instance who can forget a high-ranking DOJ enforcement attorney stating in 2017 that the DOJ’s “intent is for our FCPA investigations to be measured in months, not years”), the fact remains that FCPA scrutiny tends to last approximately four years on average.

Stericycle (an Illinois based medical waste disposal company) that has been under FCPA scrutiny since mid-2017.

The company recently disclosed:

“On June 12, 2017, the SEC issued a subpoena to the Company, requesting documents and information relating to the Company’s compliance with the FCPA or other foreign or domestic anti-corruption laws with respect to certain of the Company’s operations in Latin America. In addition, the DOJ notified the Company that it was investigating this matter in parallel with the SEC. The Company is cooperating with these agencies and certain foreign authorities. The Company also conducted an internal investigation of these and other matters, including outside of Latin America, under the oversight of the Audit Committee of the Board of Directors and with the assistance of outside counsel, and this investigation found evidence of improper conduct. As part of the FCPA investigation discussed above, the SEC requested certain additional information from the Company.

As previously disclosed, the Company has engaged in settlement discussions in connection with the foregoing government investigations. The Company is continuing to discuss with the DOJ and the SEC possible resolution, including settlement, of these matters. The Company is also discussing potential settlement of investigations by Brazilian authorities. Based on these discussions to date and as provided by U.S. GAAP, the Company has recognized an estimated aggregate accrued liability for these matters of $61.0 million within its condensed consolidated financial statements as of September 30, 2021. However, the Company cannot predict the eventual scope, duration, or outcome of these government investigations at this time, including whether a settlement will be reached, the amount of any potential monetary payments, or injunctive or other relief, the results of which may be materially adverse to the Company, its financial condition, its results of operations, and its operations. At the present time, the Company is unable to reasonably estimate nor provide any assurance regarding the amount of any potential loss in excess of the amount accrued relating to these matters.”

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