Qualcomm Whistleblower Allegations Lead to SEC, DOJ Probes

The FCPA blog, a blog dedicated to providing news and views about the United States Foreign Corrupt Practices Act (“FCPA”), reported today that Qualcomm was facing an investigation by the Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) relating to whistleblower allegations made in December 2009.  Qualcomm is an international wireless technology and services provider with revenues last year of roughly $15 billion.

Qualcomm’s disclosure of its whistleblower problems was made in its Form 10-Q Quarterly Report, which it filed yesterday.  In it, Qualcomm stated that “The audit committee completed an internal review of the allegations with the assistance of independent counsel and independent forensic accountants. This internal review into the whistleblower’s allegations and related accounting practices did not identify any errors in the Company’s financial statements. On January 27, 2012, the Company learned that the U.S. Attorney’s Office for the Southern District of California/DOJ has begun a preliminary investigation regarding the Company’s compliance with the Foreign Corrupt Practices Act (FCPA), a topic about which the SEC is also inquiring. The Company believes that it is in compliance with the requirements of the FCPA and will continue to cooperate with both agencies.”

David J. Marshall, a partner at Katz, Marshall & Banks, LLP, a law firm that represents whistleblowers providing information to the SEC about FCPA violations, said that the news was encouraging.  “Anytime the SEC or the DOJ is willing to take on one of these huge, multinational companies, it’s good for all of us,” said Marshall.  “And it’s especially good for the whistleblower that reported the violation to the SEC, who stands to earn up to thirty percent of any penalty assessed by the government under the Dodd-Frank whistleblower provisions.”