Analogic to pay $14.9 mln to settle U.S. bribery probe

(Reuters) - Analogic Corp will pay $14.9 million to settle U.S. charges the medical device maker’s Danish subsidiary conducted sham transactions with foreign distributors, with some money funneled to doctors employed by state-owned Russian entities.

The Department of Justice on Tuesday said Analogic agreed to pay a $3.4 million criminal fine as part of a non-prosecution agreement.

Analogic will also give up $7.67 million of improper gains plus $3.81 million of interest to settle related Securities and Exchange Commission civil charges, that regulator said.

Investigators said Analogic’s BK Medical ApS ultrasound equipment unit violated the Foreign Corrupt Practices Act through its dealings with distributors in Russia and five other countries.

They said the scheme resulted in millions of dollars of corrupt payments being funneled to third parties, and caused Analogic’s books and records to be falsified. The SEC said the suspicious transactions occurred from 2001 to 2011.

Analogic spokesman Mark Namaroff said the Peabody, Massachusetts-based company is glad to settle, has improved its internal controls, and set aside money to cover the accords.

The Justice Department said it credited BK Medical for its disclosures and remediation efforts, including its firing of employees responsible for the corrupt payments.

Lars Frost, a Danish citizen and former BK Medical chief financial officer, agreed to pay a $20,000 penalty to settle related SEC civil charges, the regulator said. He did not admit wrongdoing.