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Cognizant Discloses Internal Investigation, Says Indian Plant May Have Violated FCPA

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Cognizant Discloses Internal Investigation, Says Indian Plant May Have Violated FCPA

Cognizant Technology Solutions Corp (NASDAQ: CTSH) shares are trading more than ten percent down following the two significant announcements. The first one related to the management change and the second related to any possible Violation of Foreign Corrupt Practices Act.

First, Cognizant revealed the naming of Rajeev Mehta as president citing that Gordon Coburn has resigned from the position. Its press statement did not talk anything about the investigations. However, six minutes later, the company filed Form 8-K with the SEC where it spilled the beans.

In the "other events" column of the filing, the company disclosed that it is carrying out an investigation on whether any payments in respect of Indian facilities were made improperly. The company believes if any such payments happened, then it would invite FCPA in the United States.

Related Link: Needham Analyst Covering Cognizant Has Told Benzinga He Has Not Issued Research On Stock This A.M.

Cognizant indicated that its audit committee is conducting the investigation with a focus on a small number of company-owned facilities.

"The internal investigation is in its early stages, and the Company is not able to predict what, if any, action may be taken by the DOJ, SEC or any governmental authority in connection with the investigation or the effect of the matter on the Company's results of operations, cash flows or financial position," the filing indicated.

At time of publication, Cognizant had sunk 16.05 percent to $46.17.

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Posted-In: FCPA Foreign Corrupt Practices Act Gordon CoburnNews Legal Management Tech General Best of Benzinga

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