Layne Christensen announced last week that the Department of Justice has decided not to file any charges against the water management, construction, and drilling company in connection with a previously disclosed investigation into potential violations of the Foreign Corrupt Practices Act.
As Layne previously reported, questions were raised internally in September 2010 as to whether certain payments made by Layne to agents and other third parties interacting with government officials in Africa may have violated the FCPA. The audit committee engaged outside counsel to conduct an internal investigation to review these payments with assistance from outside accounting firms.
“From the very beginning, we have maintained a position of full disclosure and complete cooperation with the authorities and have worked diligently to implement remedial measures to enhance our internal controls and compliance efforts,” Layne’s CEO David Brown said in a prepared statement.
Brown added that Layne’s “voluntary disclosure, cooperation, and remediation efforts have been recognized and appreciated by the staff of the [Justice Department], and that the resolution of the investigation reflects these matters.”
The company announced that it remains “actively engaged in settlement discussions” with the Securities and Exchange Commission as it seeks to resolve a parallel investigation. “We hope to settle the SEC investigation in the near future,” Brown said.
Layne previously reserved $10.4 million in preparing for a possible settlement. Based on the Justice Department’s decision not to bring charges, the company said it will reduce the accrual related to the investigation by $5.3 million, which will be reflected in Layne’s results of operations for the second fiscal quarter ended July 31, 2014.
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