Cognizant Tchnology Solutions Corporation was a New Jersey corporation whose common stock was registered with the SEC and traded on the NASDAQ. The majority of Cognizant’s operations in India were conducted through Cognizant Technology Solutions India Private Limited, the company's largest subsidiary.
According to the documents in this case, between 2014 and 2016 Cognizant authorized a third-party construction company to pay a $2 million bribe to one or more government officials in connection with the construction of a corporate campus for Cognizant in Chennai, India.
On February 13, 2019, the DOJ issued a declination letter to Cognizant pursuant to the agency's FCPA Corporate Enforcement Policy. Under the terms of the official declination, Cogniaznt was required to disgorge $19,370,561. The DOJ agreed to credit any disgorgement (exclusive of any prejudgment interest) that Cognizant paid to the SEC in its enforcement action against the company. Crediting the $16,394,351 that Cognizant paid to the SEC, in all, the company was responsible for paying an additional $2,976,210 to the DOJ. In determining to formally decline to prosecute Cognizant, the DOJ noted the company's timely voluntary disclosure of the misconduct, the company's significant cooperation and remediation, as well as Cognizant's effective anti-corruption compliance policies and controls and the company's lack of prior criminal history.
In a related administrative proceeding initiated on February 15, 2019, the SEC issued a cease and desist order against Cognizant. Under the terms of the proceeding, the SEC ordered Cognizant to cease and desist violations of the anti-bribery, books and records, and internal controls provisions of the FCPA. The SEC further ordered Cognizant to pay disgorgement of $16,394,351 plus prejudgment interest of $2,773,017 and a civil fine of $6 million.
In a related case initiated on February 14, 2019, the DOJ filed a twelve count indictment in the District of New Jersey against Gordon J. Coburn and Steven Schwartz, Cognizant's former president and chief legal officer, alleging conspiracy to violate, as well as direct violations of, the anti-bribery, books and records, and internal controls provisions of the FCPA. That case is ongoing.
The SEC filed a related civil case on February 15, 2019, against Coburn and Schwartz, and that case is also ongoing.
In a related settled administrative proceeding initiated on September 13, 2019, the SEC ordered Sridhar Thiruvengadam, Cognizant's former Chief Operating Officer to cease and desist violations of the books and records and internal controls provisions of the FCPA as well as violations of Exchange Act Rule 13b2-2 requiring accurate statements in management letters. Under the terms of the settlement, the SEC also ordered Thiruvengadam to pay a civil penalty of $50,000, which the SEC noted was not greater due to Thiruvengadam's cooperation.
