Gartner, Inc. Agrees to Pay $2.5M to SEC for FCPA Compliance Failure

The Securities & Exchange Commission (SEC) announced late last month in an official order that fines had been levied against Gartner, Inc., headquartered in Connecticut, for violations against the ForeignCorrupt Practices Act (FCPA) they had committed while conducting business inSouth Africa.

The fines include a civil penalty in the amount of $1.6M and another amounting nearly $857,000 for disgorgement and prejudgment interest. According to the SEC, while Gartner has neither admitted to or denied these allegations, they have been cooperative with the investigation after self-disclosing the FCPA violations, by providing information as they conducted their own investigation and making employees working outside the country available for interview. The payment of $2.5M was part of an agreement including a cease-and-desist order.

Gartner, one of the world’s largest consulting corporations, is accused of having violated the anti-bribery, books and records and internal accounting controls regulations of the FCPA, while they conducted business with a South African company from December 2014 to August 2015. The South African company, unnamed, has ties to government officials, and Gartner is alleged to having known or consciously disregarded that all or a portion of their money paid would be given in bribes to convince government officials to vote in favor of consulting contracts with Gartner. 

According to the SEC, Gartner “failed to make and keep accurate books and records regarding payments made to third parties in connection with the scheme and lacked sufficient internal accounting controls surrounding the retention and payment of third parties interacting with public sector clients on its behalf.” Gartner displayed improper third party risk management in screening its third party contracts, failed in their anti-corruption vendor onboarding and had inadequate monitoring of their third party relationships.

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