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Hungary's Magyar Telekom agrees to settle SEC probe
June 27, 2011 / 8:18 AM / 6 years ago

Hungary's Magyar Telekom agrees to settle SEC probe

* Magyar Telekom agrees in principle to settle SEC probe

* Sets aside 11.7 bln forint provision in Q2 for settlement

BUDAPEST, June 27 (Reuters) - Hungary’s Magyar Telekom has agreed in principle to settle a Securities and Exchange Commission probe and set aside a provision of 11.7 billion forints ($61.6 million).

The provision occurred in the second quarter, the company said over the weekend, adding that the final settlement obligation may differ from this amount.

It said the decision follows an internal investigation at Magyar Telekom into potentially illegal payments of more than 31 million euros ($43.90 million) at its Montenegrin or Macedonian units, conducted parallel to investigations by the SEC and the U.S. Department of Justice (DOJ).

The authorities and the company have tried to establish whether Magyar Telekom breached U.S. laws, including the Foreign Corrupt Practices Act.

“The Company, without admitting or denying the allegations against it, would consent to a U.S. court order permanently enjoining it from any future FCPA violations and to the payment by the Company of disgorgement and a conditional civil penalty,” Magyar Telekom said in a statement.

The company, a unit of Germany’s Deutsche Telekom (DTEGn.DE), said it continued to negotiate a settlement with the DOJ, but may be unable to resolve the case that way and could incur further penalties and criminal sanctions.

Magyar Telekom shares eased 0.9 percent to 576 forints by 0808 GMT on Monday, against a 0.2 percent lower wider market . ($1=189.90 Forint) ($1=.7062 Euro) (Reporting by Marton Dunai; Editing by Will Waterman)

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