Clear Channel Outdoor Holdings, Inc. ("Clear Channel"), a Delaware corporation with headquarters in San Antonio,Texas, is one of the world’s largest out-of-home advertising companies. With operations in 31 countries, its common stock is traded on the New York Stock Exchange.
In a notice that it would be unable to file its 10-K on time, 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.
After filing for Chapter 11 bankruptcy in March 2018, iHeartMedia emerged in May 2019 separated from Clear Channel and its subsidiaries.
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.
In its 10-K filed on February 25, 2021, Clear Channel disclosed that the SEC had also requested information in connection with the company's historical oversight of its business in Italy and misstatements of certain tax obligations. An investigation by Italian authorities into the misstatements pre-dated the FCPA-related investigation in China, and Clear Channel reached a settlement with the Italian authorities in February 2021. Prior to this 10-K disclosure, there was no apparent connection between the Chinese and Italian investigations, and whether the Italian portion of the investigation implicates potential FCPA-related misconduct is unclear.
In its 10-K filed on February 24, 2022, Clear Channel said it had begun settlement negotiations with the SEC and DOJ. In the company's 10-Q filed on May 10, 2022, Clear Channel said it had recorded a liability in the first quarter in anticipation of the settlement, but the specific amount was not noted.
On September 28, 2023, the SEC issued a cease and desist order against Clear Channel, ending its investigation into the company.
In its 10-Q filed on November 8, 2023, Clear Channel indicated that the DOJ closed its investigation with no further action in connection with the SEC settlement.
