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Investigations Dataset

 

Investigation Name:    Investigation into Clear Media Limited's Activities in China

Trend:    None

Type of investigation:    Internal, SEC, DOJ

Agencies Investigating/Assisting with SEC/DOJ Investigation:    Chinese Law Enforcement Agency

Whistleblower:    Unknown

Summary

In a notice that it would be unable to file its 10-K on time, Clear Channel Outdoor Holdings, Inc. ("Clear Channel"), an indirect, non-wholly-owned subsidiary of iHeartMedia, Inc., disclosed that Chinese police had begun an investigation into several employees of Clear Media Limited ("Clear Media"), an indirect, non-wholly-owned subsidiary of the company for misappropriation of funds. Clear Media's board authorized the retention of outside counsel and forensic accountants to conduct an investigation into the matter, and the audit committee of Clear Channel approved the counsel and accounting firms.

iHeartMedia later disclosed in the late 10-K, filed on May 3, 2018, that it had advised both the DOJ and SEC about the investigation into Clear Media and said it intended to cooperate with any investigation that either agency might open in the matter.

In its 10-Q filed on May 6, 2020, Clear Channel disclosed that the company had received subpoenas in March 2020 from the SEC and a grand jury empaneled by the DOJ in the Eastern District of New York in connection with the investigation. The company further disclosed that in light of the investigation, it had reevaluated its ownership stake in Clear Media, and on April 28, 2020, Clear Channel sold its 50.91% stake in Clear Media to Ever Harmonic Global Limited, which was a special purpose vehicle wholly owned by a consortium of investors which includes the chief executive officer and an executive director of Clear Media. In connection with the sale of its shares in Clear Media, Clear Channel entered into an agreement with Clear Media and Ever Harmonic that requires Clear Media to use reasonable efforts to timely provide relevant factual information to the SEC or DOJ if requested by either agency.

This investigation is ongoing.

Company:    iHeartMedia, Inc.

Entity Type:    Public Company

Place of incorporation:    United States

HQ Country(ies):    United States

Ticker:    IHRT

Market:    Other (US Stock Exchange)

Industry:    Services


Company:    Clear Media Limited

Entity Type:    Public Company

Place of incorporation:    Hong Kong

HQ Country(ies):    Hong Kong

Ticker:    0100.HK

Market:    Other (Foreign Exchange)

Industry:    Services


Company:    Clear Channel Outdoor Holdings, Inc.

Entity Type:    Public Company

Place of incorporation:    United States

HQ Country(ies):    United States

Ticker:    CCO

Market:    New York Stock Exchange (NYSE)

Industry:    Services

MISCONDUCT SNAPSHOT # 1

Period of Investigated Conduct:    Unknown

Amount of Investigated Payments:    Unknown

Total Revenue Generated from Investigated Payments:    Unknown

Total Profit Earned or Expenses Avoided from Investigated Payments:    Unknown

Officials Potentially Influenced:    Unknown

Third-Party Intermediaries Involved in the Conduct:    Unknown

Types of Investigated Bribes:    Unknown

Purpose of Investigated Payments:    Unknown

Date Commenced:    03/19/2018

Publicly Disclosed by Company in Advance of Resolution:    Yes  Information

Date First Publicly Disclosed by Company:    03/19/2018

Origin of the Internal Investigation:    Unknown

Conduct Investigated:   

  • Misappropriation of funds
  • Accounting errors

Evidence of Misconduct Found:    Yes

Company Departments/Personnel Assisting with Investigation:   

  • Board of Directors

Third Parties Assisting with Investigation:   

  • Outside Counsel
  • Outside Accounting Firm

Countries/Regions Investigated:   

  • China

Scope of Investigation Expanded:    Unknown

Scope of Investigation Contracted:    Unknown

Investigating Agency (U.S.):    Securities and Exchange Commssion

Date Commenced:    05/03/2018

Publicly Disclosed by Company in Advance of Resolution:    Yes  Information

Date Investigation First Publicly Disclosed by Company:    05/22/2018

Origin of the Government Investigation:    Unknown

Agreement to Toll Statute of Limitations:    Unknown

Length of Tolling Agreement:    Unknown

Conduct Investigated:   

  • Books and Records
  • Internal Controls
  • Undetermined FCPA-Related Misconduct

Countries/Regions Investigated:   

  • China

Scope of Investigation Expanded:    Unknown

Scope of Investigation Contracted:    Unknown

Notices:    Unknown

Requests for Information:   

Type Date Requested or Received Date First Publicly Disclosed by Company Recipient Information Requested Description
Request   05/22/2018 iHeartMedia, Inc. Unknown
Subpoena 03 /2020 05/06/2020 Clear Channel Outdoor Holdings, Inc.

Status of SEC Investigation   

Status:  Investigation Is Ongoing

Most Recent Disclosure Date:  05/06/2020

Investigating Agency (U.S.):    U.S. Department of Justice

Date Commenced:    05/03/2018

Publicly Disclosed by Company in Advance of Resolution:    Yes  Information

Date Investigation First Publicly Disclosed by Company:    05/22/2018

Origin of the Government Investigation:    Unknown

Agreement to Toll Statute of Limitations:    Unknown

Length of Tolling Agreement:    Unknown

Conduct Investigated:   

  • Books and Records
  • Internal Controls
  • Undetermined FCPA-Related Misconduct

Countries/Regions Investigated:   

  • China

Scope of Investigation Expanded:    Unknown

Scope of Investigation Contracted:    Unknown

Grand jury empaneled?    Yes

  • Date Empaneled:    Unknown
  • Date First Publicly Disclosed by Company:    05/06/2020

Notices:    Unknown

Requests for Information:   

Type Date Requested or Received Date First Publicly Disclosed by Company Recipient Information Requested Description
Request   05/22/2018 iHeartMedia, Inc. Unknown
Subpoena 03 /2020 05/06/2020 Clear Channel Outdoor Holdings, Inc.

Status of DOJ Investigation   

Type:  Investigation Is Ongoing

Most Recent Disclosure Date:  05/06/2020

Transaction/Spin-off/Reorganization Negotiated or Completed During Misconduct or Investigation:    Yes

Successor:    Ever Harmonic Global Limited

Predecessor:    Clear Media Limited

Nature of Misconduct

Type of Transaction:    Spin-off

Misconduct Occurred Solely Pre-acquisition:    Yes

Misconduct Occurred Pre- and Post-acquisition, with NO Knowledge and/or Involvement of Successor:    No/Unknown

Misconduct Occurred Pre and Post-acquisition, with Knowledge and/or Involvement of Successor:    No/Unknown

Voluntary Disclosure by Successor in Connection with the Transaction:    No/Unknown

DOJ Opinion Sought in Connection with Transaction:    No/Unknown

Successor Investigated in Connection with the Misconduct:    Unknown

Mitigating Factors Disclosed by the Company Under Investigation:     Information

Self-Report Cooperation Voluntary Remedial Measures

FCPA-Related Investigation Costs  Information

Aggregate Incurred Costs:    Unknown

Aggregate Accruals:    Unknown

No Date Document Type Source Public Disclosure