NCR investigating allegations of bribery, sanctions violation
(Reuters) - ATM maker NCR Corp (NCR.N) said it was investigating anonymous allegations regarding some of its business practices in China, the Middle East and Africa.
Wall Street Journal first reported the news of the allegations and investigation on Monday, saying the company may have violated both anti-bribery laws and U.S. sanctions against Syria. (r.reuters.com/kup99s) (r.reuters.com/xeg99s)
Shares of the company slid as much as 12 percent on Tuesday after Wedbush Securities Inc downgraded NCR to "neutral" and warned that the investigation may have a significant effect on the company.
The company said it received the allegations "from a purported whistleblower," and retained an outside counsel for an internal investigation.
"NCR has certain concerns about the motivation of the purported whistleblower and the accuracy of the allegations it received, some of which appear to be untrue," the company said.
NCR added that it has ceased operations in Syria, which were commercially insignificant. The company said it would not comment on ongoing internal investigations.
Wedbush said investigation costs and a fine under the U.S. Foreign Corrupt Practices Act (FCPA) could set NCR back by millions or tens of millions of dollars.
Revenue of $200 million to $300 million from NCR's Chinese business might be at risk if the allegations there were proven, the analyst added.
A two-year FCPA investigation cost rival Diebold Inc (DBD.N) an estimated $100 million from its Russian business and may end in a significant fine, Wedbush analyst Gil Luria said in a note to clients.
NCR shares were down 10 percent at $22.50 on the New York Stock Exchange on Tuesday afternoon. They had touched a low of $22.08 earlier in the session.
- U.S. immigration protesters drop U.S. border blockade plan
- Exclusive: Angry with Washington, 1 in 4 Americans open to secession
- Defeated nationalist leader says Scots 'tricked' out of independence
- Selling Mitch McConnell: What's love got to do with it?
- Kurds issue new call to arms against Islamic State in Syria |