In re CLEAR CHANNEL

 
 
 
     UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 98615 / September 28, 2023 
 
ACCOUNTING AND AUDITING ENFORCEMENT  
Release No. 4466 / September 28, 2023 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-21755 
 
 
In the Matter of 
 
CLEAR CHANNEL 
OUTDOOR HOLDINGS, 
INC. 
 
Respondent. 
 
 
ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO 
SECTION 21C OF THE SECURITIES 
EXCHANGE ACT OF 1934, MAKING 
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER 
  
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities 
Exchange Act of 1934 (“Exchange Act”), against Clear Channel Outdoor Holdings, Inc. (“CCOH” 
or “Respondent”).   
 
II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (“Offer”) which the Commission has determined to accept.  Solely for the purpose of 
these proceedings and any other proceedings brought by or on behalf of the Commission, or to 
which the Commission is a party, and without admitting or denying the findings herein, except as 
to the Commission’s jurisdiction over Respondent and the subject matter of these proceedings, 
which are admitted, Respondent consents to the entry of this Order Instituting Cease-and-Desist 
Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, 
and Imposing a Cease-and-Desist Order (“Order”), as set forth below.   
 

   
 
2 
 
III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds
1
 that:  
 
SUMMARY 
 
1. This matter concerns violations of the anti-bribery, recordkeeping, and internal 
accounting controls provisions of the Foreign Corrupt Practices Act of 1977 (“FCPA”) by Clear 
Channel Outdoor Holdings, Inc. (“CCOH”), a Texas-headquartered company in the out-of-home 
advertising industry, in connection with the actions of its agent, CCOH’s former indirect, majority-
owned Chinese subsidiary, Clear Media Limited (“Clear Media”).  From at least 2012   through 
2017, Clear Media bribed Chinese government officials, both directly and through third parties, to 
obtain concession contracts required to sell advertising services to public and private sector clients 
for display on public bus shelters, street furniture, and billboards.  In addition, Clear Media used 
sham intermediaries and false invoices to generate cash for off-book consultants engaged to win 
advertising business from government and private customers.  From at least 2012 through 2019 
(the “relevant period”), CCOH failed to ensure that sufficient internal accounting controls were in 
place at Clear Media.  CCOH received approximately $16.4 million in benefits as a result of Clear 
Media’s improper payments, which were inaccurately recorded as legitimate business expenses in 
CCOH’s consolidated books and records.   
 
RESPONDENT 
 
2. CCOH is a Delaware corporation headquartered in San Antonio, Texas.  
Throughout the relevant period until May 2019, CCOH’s then-corporate parent, iHeartMedia
2
 (as 
defined herein), owned the majority of CCOH’s outstanding shares.  In May 2019, CCOH fully 
separated from iHeartMedia as part of the latter’s Chapter 11 bankruptcy proceedings, emerging as 
a standalone, publicly traded company; at this time, iHeartMedia ceased to own any shares of 
CCOH.  CCOH’s common stock is and, throughout the relevant period, was registered with the 
Commission pursuant to Section 12(b) of the Exchange Act and trades on the New York Stock 
Exchange under the Ticker “CCO.”  CCOH reported a total revenue of $2.7 billion for 2019 and, at 
that time, had approximately 5,900 employees worldwide.   
 
OTHER RELEVANT ENTITIES AND INDIVIDUALS 
 
3. iHeartMedia, Inc. (“iHeartMedia”) is a Delaware corporation headquartered in 
San Antonio, Texas, which served as CCOH’s ultimate corporate parent and owned the majority of 
CCOH’s outstanding shares and total voting power until May 2019.  During the beginning of the 
relevant period prior to 2014, iHeartMedia was named CC Media Holdings, Inc.  
 
 
1
 The findings herein are made pursuant to Respondent’s Offer of Settlement and are not binding on any other 
person or entity in this or any other proceeding. 
2
 During the beginning of the relevant period prior to 2014, the iHeartMedia subsidiary which owned CCOH’s 
shares was named Clear Channel Communications, Inc.  

   
 
3 
 
 
4. Clear Channel International (“CCI”) was,  during the relevant period, a CCOH 
division based in London, England.   
 
5. Clear Media Limited was,  during the relevant period, a Bermuda-incorporated 
holding company, headquartered in Guangzhou, China, through which CCOH conducted business 
in China.  Since 2005, Clear Media Limited was majority-owned by CCOH.  Since December 
2001, Clear Media Limited listed a portion of its shares on the Hong Kong Stock Exchange.  Clear 
Media Limited, in turn, operated through a joint venture entity (together, “Clear Media”) between 
Clear Media Limited and a PRC-incorporated company controlled by Related Group (“JV 
Partner”).    Clear Media’s books and records were consolidated into CCOH’s consolidated 
financial statements for purposes of Commission filings through fiscal year 2020, when CCOH 
sold its interest in the Clear Media business. 
 
6. Related Group was, during the relevant period,  a group of companies operating in 
China that were controlled by Executive A’s close family member (“Executive A’s Relative”) and 
included, among others, JV Partner and various cleaning and maintenance entities used by Clear 
Media. 
 
7. Executive A, a  Chinese citizen and resident, was,  during the relevant period, Clear 
Media’s principal executive officer. 
 
8. Executive B, a Singaporean citizen and Chinese resident, was, during the relevant 
period,  a senior executive officer of Clear Media.  
 
FACTS 
 
Background: CCOH’s  control over Clear Media 
    
9. CCOH acquired an interest in certain advertising companies associated with 
Executive A and Executive A’s Relative in China in 1998.  In 2001, Clear Media Limited listed its 
shares on the Main Board of the Stock Exchange of Hong Kong Limited, and CCOH reorganized 
its holding through Clear Media.  From 2005 through March 2020, CCOH held a majority of Clear 
Media’s shares.  CCOH provided out-of-home advertising services in China solely through Clear 
Media and, through CCI, consolidated Clear Media’s results in its financial statements.  
  
10. During the relevant period, Executive A served as Clear Media’s p rincipal 
executive officer.  CCOH exercised control of Clear Media through the participation of two to 
three executives on Clear Media’s board of directors, including in positions as Executive Chairman 
and Deputy Chairman of its board.
 
  Executives from CCOH’s finance, legal, and compliance 
functions also participated regularly in Clear Media’s board meetings, as well as in certain Clear 
Media audit committee meetings.    
 

   
 
4 
 
11. CCOH controlled the majority of voting shares of Clear Media.  CCOH set 
financial goals for Clear Media; supervised Clear Media’s financial performance, management, 
and organization; and defined Clear Media management’s scope of responsibility.  Using U.S.-
based email systems, CCOH executives approved Clear Media’s budget and significant 
transactions, including tenders for concessions.  CCOH also controlled the adoption of  Clear 
Media’s compliance policies and the hiring, firing, and compensation of Executive A and other 
Clear Media executives.  Clear Media reported to CCOH through the Executive Chairman of Clear 
Media’s board of directors, a role filled by a CCOH executive for Asia Pacific from 2012 until 
2015.  Thereafter, the Executive Chairman of Clear Media’s board reported to CCOH’s head of the 
CCI division.  CCOH conducted annual audits of Clear Media, including compliance, operational, 
and SOX audits.  
 
Clear Media made improper payments to obtain and retain business in China  
and inaccurately documented and recorded the payments. 
 
12. From at least 2012 through 2017, acting directly and through third parties, Clear 
Media provided improper benefits to obtain and renew concessions and advertising contracts in 
China and failed to appropriately document and record those payments in its books and records.   
 
13. To obtain concession contracts from local Chinese government transport 
authorities, Clear Media provided cash-equivalent gift cards, golf clubs, vases, and other expensive 
and unidentified gifts and entertainment, some of which were provided “due to being in the 
negotiation process with clients for a renewal.”  Executive A spent hundreds of thousands of 
dollars, subject to no advance review or approval, on government officials for first-class travel, 
hotel rooms, meals, and entertainment.  Clear Media’s documentation often failed to identify the 
officials who received the benefits or to specify the amount spent on each official’s behalf.  In one 
instance in September 2015, Clear Media employees were cautioned by local Clear Media 
management not to “describe the purposes of the Hospitality Costs too specifically, e.g., for the 
purpose of winning the contract.”    
  
14. Clear Media also provided improper benefits to government officials through 
vendors known as “cleaning and maintenance entities,”    which helped obtain Clear Media’s 
concession contracts as well as build, clean, and maintain its advertising displays.  Many of Clear 
Media’s cleaning and maintenance vendors were Related Group companies.  Contrary to Clear 
Media’s policies, Clear Media made certain payments to the cleaning and maintenance entities 
based solely on oral agreements, often disguising payments for the benefit of government officials 
as various “subsidies” or “special request” expenses.  Written contracts Clear Media had with such 
entities often lacked specificity as to payment rates and amounts, and certain contracts did not have 
anti-corruption provisions or audit rights, contrary to Clear Media’s policies.  Further, the cleaning 
and maintenance entities did not detail the services they provided, as Clear Media’s policies 
required before paying vendors.   
 
15. In addition to cleaning and maintenance expenses, the budget Clear Media allocated 
to cleaning and maintenance entities included salaries, bonuses, entertainment, and other expenses.  

   
 
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Records indicate that Clear Media also maintained an annual reserve of $525,000 to $600,000 for 
“special funding” or “special request funding” for ad hoc requests, and that “from discussions in 
Hangzhou [in 2017,] special request funding ha[d] been used [in Hangzhou] solely for Government 
official entertaining.”
3
 
  
16. In December 2016, Clear Media’s Hangzhou branch spent $ 12,800 on customer 
entertainment while it was seeking the renewal of a priority concession with a Hangzhou transit 
authority (the “Hangzhou Concession”).    In January 2017, Clear Media provided its Hangzhou 
branch with approximately $14,000 to entertain government officials “due to the need to 
renegotiate” the Hangzhou Concession.  Clear Media’s Hangzhou branch then transferred 
approximately $20,350 to its cleaning and maintenance entity, classifying the payment as a 
“subsidy” or an “allowance.”  The same month, the Hangzhou Concession was renewed.    
 
17. Similarly, the general manager of Clear Media’s cleaning and maintenance entity in 
Shanghai told CCOH’s internal auditors during a 2017 audit that his main responsibility, along 
with Executive A, was to maintain a “close relationship” with Shanghai government officials, 
including through entertainment, in order to avoid having the Shanghai concession put out for 
public tender.  He stated that Clear Media would lose the concession in an open tender because it 
was unable to compete based on price.  Clear Media entered into a ten-year concession agreement 
with Shanghai public transit   authorities in December 2016.   
 
18. In addition to improper payments made to obtain concession contracts, Clear Media 
engaged in a “customer development expense” scheme from at least 2013 through 2017.  Through 
this scheme, Clear Media developed an off-book cash fund for payments made to undisclosed 
consultants to win, grow, or retain advertising business from approximately 70 private and 
government customers.  Clear Media purportedly considered the identities of the consultants to be 
sensitive and confidential information and did not properly diligence or document them.  In some 
cases, Clear Media withdrew cash directly from its bank account for personnel to pay the 
undisclosed consultants.  In others, Clear Media created false invoices and tax records to justify 
cash payments to three shell company intermediaries that provided no actual services.  The shell 
companies, whose legal representatives included Executive A’s driver and personal assistant, were 
controlled by Related Group.  After a series of cash deposits and withdrawals through layers of 
bank accounts held in the names of employees of Clear Media and Related Group companies, 
Clear Media sales directors distributed the cash to 19 different undisclosed consultants.  The 
payments ranged from two to five percent of the advertising contracts’ value.  Clear Media had no 
written agreements with the consultants or records of the payments made to them.  
 
 
 
3
 All U.S. dollar payment amounts and other U.S. dollar figures relating to Clear Media identified in this Order were 
converted from Chinese RMB or the Hong Kong Dollar at the exchange rate prevailing at the relevant time. 

   
 
6 
 
From 2012 through 2017, CCOH’s internal auditors identified  
bribery-related concerns and internal accounting control deficiencies at Clear Media. 
 
19. From 2012 through 2017, CCOH’s internal auditors repeatedly reported elevated 
bribery risks at Clear Media and concerns regarding Clear Media’s compliance program and 
internal accounting controls, including in relation to cleaning and maintenance vendors;  travel, 
gifts, and entertainment; compliance training; and whistleblower hotline implementation.  While 
CCOH audit reports identified certain remedial actions to be taken by Clear Media, CCOH failed 
to ensure that Clear Media took adequate steps to sufficiently address these repeated concerns.  In 
some cases, CCOH’s internal auditors erroneously reported that audit issues were remediated 
based on information provided by Clear Media,  only to note the same issues in later audits; failed 
to elevate certain concerns they identified at Clear Media; and failed to adequately test high-risk 
transactions to detect long-running payment schemes.   
 
20. In 2012,  CCOH’s internal auditors reported that Clear Media had made 
discretionary payments to cleaning and maintenance entities in China that could not be traced to 
written contracts.  Clear Media also paid the majority of the salaries of the entities’ senior 
management.  Although Clear Media was using the cleaning and maintenance entities to interface 
with government officials, it required no compliance representations or training for the employees 
of these entities.  CCOH Internal Audit also flagged Clear Media’s failure to implement a 
whistleblower hotline.   
 
21. In 2013,  CCOH’s internal auditors reported that the issues raised in their 2012 
compliance audit had been addressed by Clear Media management, without describing how certain 
issues, some of which became the subject of repeat audit findings in 2014 and 2015, were resolved.  
Similarly, in 2014, CCOH’s internal auditors concluded, based solely on assertions by certain 
Clear Media managers,  that Clear Media used no intermediaries for dealings with municipal 
governments.  In fact, however, Clear Media was making substantial ongoing payments to cleaning 
and maintenance entities, which past internal audits had found interacted with local officials on 
Clear Media’s behalf.    Nevertheless, in September 2014, CCOH’s internal auditors assigned Clear 
Media a “marginal” rating due to concerns related to gifts and entertainment for government 
officials, among other issues, and recommended that expense approval and documentation 
processes and procedures be improved at Clear Media.    
 
22. In connection with a 2015 specific scope audit focusing on the company’s Shanghai 
branch, CCOH’s internal auditors found that Clear Media continued to pay cleaning and 
maintenance entities at undocumented rates based on oral agreements and to employ the entities’ 
senior management, and their Audit Report recommended that contracts going forward formally 
document rates payable to the entities.  In a subsequent 2015 compliance audit, the auditors 
reported that some gifts and entertainment Clear Media provided to government officials may 
violate relevant anti-corruption laws.  Examples included a set of gifts provided “due to being in 
the negotiation process with clients for a renewal,” as well as cash-equivalent gifts, golf clubs, and 
other items provided at the request of government officials.  In its Audit Report, CCOH’s internal 
auditors recommended that Clear Media create a clear policy governing appropriate gift and 

   
 
7 
 
hospitality practices, to be agreed to and monitored by CCOH compliance and Clear Media’s local 
compliance officer.  
 
23. CCOH’s internal auditors reported to CCOH’s management or audit committee in 
2015, 2016, and 2017 that some of Clear Media’s gift and entertainment expenses for government 
officials may be “problematic” or “high risk” under applicable anti-corruption laws and carried 
risks of fines and reputational damage.  A 2016 Audit Report also flagged gaps in Clear Media’s 
provision of compliance training below the senior management level and in publicizing its 
whistleblower hotline, while the auditors failed to perform any testing of Clear Media’s due 
diligence files and contracts to verify the accuracy of Clear Media’s assertions about its use of third 
parties, contrary to their standard testing protocol.   
 
24. Following three “marginal” compliance ratings in three years, Clear Media entered 
a cycle of “unsatisfactory” audit findings beginning in 2017 based primarily on continued concerns 
about cleaning and maintenance vendors.  A January 2017 report issued by Clear Media’s internal 
auditor, reviewed by CCOH’s internal auditors and a CCI executive, reported that the cleaning and 
maintenance entities’ government interactions included obtaining approvals and negotiating 
penalties and concession contracts for Clear Media.  Despite the elevated corruption risks of this 
relationship, Clear Media’s payments to the entities included “special request expenses” and 
“allowances” intended to enable the entities “to maintain or build[] up relationships with local 
authorities.”  Clear Media also subsidized the entities’ salary and rent, purchased their vehicles, 
and provided bonuses and trips for their personnel.  Cleaning and maintenance agreements 
automatically renewed without due diligence or competitive bidding.   
 
25. In 2017, during a specific scope audit focusing on Clear Media’s Shanghai and 
Hangzhou branches, CCOH’s internal auditors also noted concerns in their work papers about the 
significant entertainment expenditures for Hangzhou government officials “due to the need to 
renegotiate” the Hanghzhou Concession in early 2017.  These specific concerns were not reflected 
in the summary report provided to CCOH’s management and presented to CCOH’s audit 
committee.   
 
In 2017, Clear Media blocked CCOH’s internal auditors’ access to records. 
 
26. Given the risks surrounding Clear Media’s payments to cleaning and maintenance 
entities, in 2017, CCOH’s    internal auditors requested support concerning the entities’ monthly 
expenditures, as well as for the payments made to entertain officials renegotiating the Hangzhou 
Concession in early 2017.  Executive A blocked CCOH’s internal auditors, Clear Media’s internal 
auditor, and Executive B from obtaining access to the requested records.     
 
27. Following the 2017 audit, CCOH’s i nternal auditors raised concerns about access to 
records with Clear Media management and with Clear Media’s Chairman of the Board and Audit 
Committee Chair.  Executive A’s actions were then reported to CCOH’s senior executives and 
audit committee.  CCOH’s i nternal auditors assigned Clear Media an “unsatisfactory” audit rating 

   
 
8 
 
due largely to CCOH’s i nternal auditors’ inability to provide assurance on the appropriateness or 
validity of Clear Media’s payments to cleaning and maintenance vendors. 
 
In 2018, a misappropriation scheme came to light, revealing additional  
weaknesses in Clear Media’s internal accounting controls. 
 
28. In January 2018, a Clear Media cashier confessed to Chinese authorities that he had 
participated in a decade-long misappropriation scheme.  Clear Media’s board engaged local 
counsel and the Hong Kong branch of an accounting firm to investigate the misappropriation.  In 
February 2018, Clear Media’s external auditors also identified suspicious commission payments 
made to entities related to Executive A.  Clear Media’s investigation found that: 
 
• Between 2007 and 2017, at least three Clear Media employees engaged in a 
series of unrecorded and allegedly unauthorized transactions to 
misappropriate approximately USD $10.2 million;  
 
• Between 2011 and 2018, undisclosed, “off-book” bank accounts in Clear 
Media’s name were used to receive government subsidies totalling at least 
USD $5.2 million that were not recorded as income; and 
 
• Between at least 2015 and 2017, Clear Media made approximately USD 
$9.8 million in cash “customer development” payments, both through Clear 
Media personnel and Related Group shell companies, to 19 secret 
consultants to obtain or retain business with approximately 70 government 
and private customers.    
 
29. Executive A prevented investigators from interviewing Related Group employees 
regarding the “customer development” expenses and from accessing its records.  Clear Media 
eventually permitted external legal counsel in China to contact five of the 19 consultants by 
telephone, all of whom denied making improper payments.  Investigators had no access, however, 
to the secret consultants’ books and records to verify how the “customer development” fees were 
used.   
 
30. While CCOH did not become aware of the “customer development” expense 
scheme until 2018, later investigation revealed that Clear Media’s payments to secret consultants 
began no later than 2013.  CCOH’s monitoring of Clear Media failed to detect the repeated, large 
cash withdrawals and commission payments that Clear Media made for at least five years, from 
2013 through 2017, in furtherance of the “customer development” scheme.   
 
31. At the same time, as of 2018, many of the issues CCOH’s internal auditors did 
identify in audits of Clear Media since 2012 remained insufficiently or only partially remediated by 
Clear Media.  For example, a compliance questionnaire Clear Media completed in March 2018 
reflected that Clear Media did not conduct due diligence on agents, did not require approval of new 
suppliers before processing payments to them, did not obtain required legal department approval of 

   
 
9 
 
related party transactions, did not include CCOH’s anti-bribery contractual provisions and audit 
clauses in its model contracts, and did not publicize the CCOH whistleblower hotline. 
 
32. In March 2018,  Clear Media provided information regarding its investigation to the 
Hong Kong Stock Exchange, which temporarily suspended trading in Clear Media securities in 
April 2018.  CCOH made a parallel disclosure to the Commission in anticipation of a   delayed 
filing of its annual report.  About the same time, the Hong Kong office of CCOH’s external 
auditors disclaimed its 2017 audit opinion of Clear Media’s financials.    CCOH’s external auditors 
in the United States determined that Clear Media’s internal control over financial reporting had a 
material weakness related to approvals and segregation of duties within cash management and 
banking processes.  Gaps surrounding vendor payments and cash disbursement were deemed a 
significant deficiency.  
 
33. To remediate these issues, Clear Media engaged an accounting firm (“Accounting 
Firm”) to review its internal control over financial reporting.  Accounting Firm’s September 2018 
recommendations were similar to those CCOH’s internal auditors had made from 2012 to 2017 
regarding Clear Media’s governance of supplier management, conflicts of interest, related party 
transactions, employee expense claims, and whistleblowing.  Accounting Firm’s recommendations 
also addressed Clear Media’s “customer development” expenses and internal audit function. 
 
Throughout 2019, Clear Media continued to block access to financial records  
and pay cleaning and maintenance entities without adequate support. 
 
34. Executive A continued to deny CCOH’s internal auditors access to financial 
records related to the cleaning and maintenance entities’ expenses in 2019.  CCOH’s internal 
auditors reported this to their executive management, along with continuing concerns regarding 
Clear Media’s whistleblowing hotline implementation and provision of meals and entertainment.   
 
35. Accounting Firm assigned Clear Media “unsatisfactory” ratings in two internal 
audits it conducted in 2019.  Accounting Firm found that Clear Media continued to pay substantial 
“business development assistance fees”   to cleaning and maintenance entities related to acquiring or 
renewing concession rights;  there were no formal contractual agreements in respect to these 
services or bases to support the amounts paid.  Accounting Firm concluded that these payments 
created a “critical risk” to Clear Media’s operational performance, financial statements, and 
reputation or could result in legal fines and penalties.    Accounting Firm further found a high risk 
associated with Clear Media’s payments to the entities to clean and maintain bus shelters, which 
also lacked an adequately documented basis, and recommended clarification of pricing models and 
monitoring of payments for appropriateness.     
 
36. In May 2019, CCOH legally separated from its former ultimate parent company, 
had a new class of stockholders,  and formed a new board of directors.  Despite various remedial 
efforts, by the end of 2019, CCOH still could not assure itself that Clear Media’s payments to 
cleaning and maintenance entities were being spent appropriately, consistent with CCOH 
management’s policies, and in compliance with anti-corruption laws.  In November 2019, CCOH 

   
 
10 
 
announced a strategic review of its interest in Clear Media.  In March 2020, CCOH disposed of its 
interest in Clear Media.  
 
LEGAL STANDARDS AND VIOLATIONS 
 
37. Under Exchange Act Section 21C(a), the Commission may impose a cease-and-
desist order upon any person who is violating, has violated, or is about to violate any provision of 
the Exchange Act or any regulation thereunder, and upon any other person that is, was, or would 
be a cause of the violation, due to an act or omission the person knew or should have known would 
contribute to such violation. 
 
38. As a result of the conduct described above, Respondent violated Section 30A of the 
Exchange Act, which prohibits any issuer with a class of securities registered pursuant to Section 
12 of the Exchange Act or with reporting obligations pursuant to Section 15(d) of the Exchange 
Act, or any officer, director, employee, or agent of such issuer, or any stockholder acting on behalf 
of an issuer, from making use of the mails or any means or instrumentality of interstate commerce 
corruptly in furtherance of an offer, payment, promise to pay, or authorization of the payment of 
any money, or offer, gift or promise to give anything of value to any foreign official, for purposes 
of influencing any act or decision of such foreign official in his official capacity in order to assist 
such issuer in obtaining or retaining business for or with any person. 
 
39. As a result of the conduct described above, Respondent violated Section 
13(b)(2)(A) of the Exchange Act, which requires issuers with a class of securities registered 
pursuant to Section 12 of the Exchange Act and issuers with reporting obligations pursuant to 
Section 15(d) of the Exchange Act to make and keep books, records, and accounts, which, in 
reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the 
issuer. 
 
40. As a result of the conduct described above, Respondent violated Section 
13(b)(2)(B) of the Exchange Act, which requires issuers with a class of securities registered 
pursuant to Section 12 of the Exchange Act and issuers with reporting obligations pursuant to 
Section 15(d) of the Exchange Act to devise and maintain a system of internal accounting controls 
sufficient to provide reasonable assurances that (i) transactions are executed in accordance with 
management’s general or specific authorization; (ii) transactions are recorded as necessary (I) to 
permit preparation of financial statements in conformity with generally accepted accounting 
principles or any other criteria applicable to such statements, and (II) to maintain accountability for 
assets; (iii) access to assets is permitted only in accordance with management’s general or specific 
authorization; and (iv) the recorded accountability for assets is compared with the existing assets at 
reasonable intervals and appropriate action is taken with respect to any differences. 
 
Disgorgement and Civil Penalties 
 
41. The disgorgement and prejudgment interest referenced in Section IV below is 
consistent with equitable principles, does not exceed Respondent’s net profits from its violations, 

   
 
11 
 
and returning the money to Respondent would be inconsistent with equitable principles.  
Therefore, in these circumstances, distributing disgorged funds to the United States Treasury is the 
most equitable alternative.  The disgorgement and prejudgment interest referenced in Section IV 
below shall be transferred to the general fund of the United States Treasury, subject to Section 
21F(g)(3) of the Exchange Act. 
 
Cooperation and Remediation 
 
42. In determining to accept the Offer, the Commission considered CCOH’s 
cooperation and remedial efforts.   
 
43. CCOH’s cooperation included: (1) promptly sharing facts developed in its own 
internal investigation;  (2) proactively producing relevant documents, including documents from 
Clear Media, both prior to and following the sale of CCOH’s interest in Clear Media,  that were 
located overseas;  (3) producing, in real time, documentation of audits of Clear Media internal 
controls during the course of the investigation; (4) providing translations of documents; (5) 
facilitating the production of documents from third parties; and (6) facilitating the Commission’s 
staff’s interviews of current and former employees of CCOH’s foreign subsidiaries and of certain 
third parties.
 
 
 
44. CCOH’s remediation efforts include:  (1) disposing of its interest in Clear Media; 
(2) enhancing CCOH’s anti-corruption compliance policies, procedures, and related internal 
accounting controls surrounding third-party due diligence, contracting, payments, and monitoring; 
gifts, meals, entertainment, and travel; conflicts of interest; and the monitoring and remediation of 
internal audit issues and actions; (3) implementing annual compliance reviews of internal 
accounting controls across its business units; (4) increasing human and financial resources for 
compliance, including the hiring of a dedicated Compliance Director; (5) introducing ethics and 
compliance considerations into performance evaluations and compensation decisions; and (6) 
enhancing online and live anti-corruption training programs.   
   
IV. 
 
 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 
agreed to in Respondent’s Offer. 
 
 Accordingly, it is hereby ORDERED that: 
 
 A. Pursuant to Section 21C of the Exchange Act, Respondent cease and desist from 
committing or causing any violations and any future violations of Sections 30A, 13(b)(2)(A), and 
13(b)(2)(B) of the Exchange Act.   
 
 B. Respondent shall pay disgorgement of $16,355,567, prejudgment interest of 
$3,760,920, and a civil monetary penalty in the amount of $6,000,000 to the Securities and 
Exchange Commission for transfer to the general fund of the United States Treasury, subject to 

   
 
12 
 
Exchange Act Section 21F(g)(3).  Respondent shall pay $13,058,243.50 within 30 days after entry 
of the Order; and the remaining balance in one-third equal installments under the following 
schedule: 305 days, 335 days, and 365 days after the entry of the Order until the full amount and 
interest is paid.  Payments shall be applied first to post-order interest, which accrues pursuant to 
SEC Rule of Practice 600 and 31 U.S.C. § 3717.  Prior to making the final payment set forth herein, 
Respondent shall contact the staff of the Commission for the amount due.  If Respondent fails to 
make any payment by the date agreed and/or in the amount agreed according to the schedule set 
forth above, all outstanding payments under this Order, including post-order interest, minus any 
payments made, shall become due and payable immediately at the discretion of the staff of the 
Commission without further application to the Commission.
 
 
 C. Payment must be made in one of the following ways:   
 
(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  
 
(2) Respondent may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondent may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
 
Payments by check or money order must be accompanied by a cover letter identifying 
CCOH as a Respondent in these proceedings, and the file number of these proceedings; a copy of 
the cover letter and check or money order must be sent to Charles Cain, Chief, FCPA Unit, 
Division of Enforcement, Securities and Exchange Commission, 100 F St., NE, Washington, DC 
20549-5631.   
 
 D. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes.  To 
preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 
Action (as defined herein), it   shall not argue that it is entitled to, nor shall it benefit by, offset or 
reduction of any award of compensatory damages by the amount of any part of Respondent’s 
payment of a civil penalty in this action (“Penalty Offset”).  If the court in any Related Investor 
Action grants such a Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a 
final order granting the Penalty Offset, notify the Commission’s counsel in this action and pay the 
amount of the Penalty Offset to the Securities and Exchange Commission.  Such a payment shall 

   
 
13 
 
not be deemed an additional civil penalty and shall not be deemed to change the amount of the civil 
penalty imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” 
means a private damages action brought against Respondent by or on behalf of one or more 
investors based on substantially the same facts as alleged in the Order instituted by the 
Commission in this proceeding. 
 
 By the Commission. 
 
 
Vanessa A. Countryman 
Secretary 
 

UNITED STATES OF AMERICA 
Before the 

SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 98615 / September 28, 2023 
 
ACCOUNTING AND AUDITING ENFORCEMENT  
Release No. 4466 / September 28, 2023 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-21755 
 
 
In the Matter of 
 

CLEAR CHANNEL 
OUTDOOR HOLDINGS, 
INC. 

 
Respondent. 
 
 

ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO 
SECTION 21C OF THE SECURITIES 
EXCHANGE ACT OF 1934, MAKING 
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER 

  
I. 

 
 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities 
Exchange Act of 1934 (“Exchange Act”), against Clear Channel Outdoor Holdings, Inc. (“CCOH” 
or “Respondent”).   
 

II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (“Offer”) which the Commission has determined to accept.  Solely for the purpose of 
these proceedings and any other proceedings brought by or on behalf of the Commission, or to 
which the Commission is a party, and without admitting or denying the findings herein, except as 
to the Commission’s jurisdiction over Respondent and the subject matter of these proceedings, 
which are admitted, Respondent consents to the entry of this Order Instituting Cease-and-Desist 
Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, 
and Imposing a Cease-and-Desist Order (“Order”), as set forth below.   
 



   
 

2 
 

III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds1 that:  
 

SUMMARY 
 

1. This matter concerns violations of the anti-bribery, recordkeeping, and internal 
accounting controls provisions of the Foreign Corrupt Practices Act of 1977 (“FCPA”) by Clear 
Channel Outdoor Holdings, Inc. (“CCOH”), a Texas-headquartered company in the out-of-home 
advertising industry, in connection with the actions of its agent, CCOH’s former indirect, majority-
owned Chinese subsidiary, Clear Media Limited (“Clear Media”).  From at least 2012 through 
2017, Clear Media bribed Chinese government officials, both directly and through third parties, to 
obtain concession contracts required to sell advertising services to public and private sector clients 
for display on public bus shelters, street furniture, and billboards.  In addition, Clear Media used 
sham intermediaries and false invoices to generate cash for off-book consultants engaged to win 
advertising business from government and private customers.  From at least 2012 through 2019 
(the “relevant period”), CCOH failed to ensure that sufficient internal accounting controls were in 
place at Clear Media.  CCOH received approximately $16.4 million in benefits as a result of Clear 
Media’s improper payments, which were inaccurately recorded as legitimate business expenses in 
CCOH’s consolidated books and records.   

 
RESPONDENT 

 
2. CCOH is a Delaware corporation headquartered in San Antonio, Texas.  

Throughout the relevant period until May 2019, CCOH’s then-corporate parent, iHeartMedia2 (as 
defined herein), owned the majority of CCOH’s outstanding shares.  In May 2019, CCOH fully 
separated from iHeartMedia as part of the latter’s Chapter 11 bankruptcy proceedings, emerging as 
a standalone, publicly traded company; at this time, iHeartMedia ceased to own any shares of 
CCOH.  CCOH’s common stock is and, throughout the relevant period, was registered with the 
Commission pursuant to Section 12(b) of the Exchange Act and trades on the New York Stock 
Exchange under the Ticker “CCO.”  CCOH reported a total revenue of $2.7 billion for 2019 and, at 
that time, had approximately 5,900 employees worldwide.   
 

OTHER RELEVANT ENTITIES AND INDIVIDUALS 
 
3. iHeartMedia, Inc. (“iHeartMedia”) is a Delaware corporation headquartered in 

San Antonio, Texas, which served as CCOH’s ultimate corporate parent and owned the majority of 
CCOH’s outstanding shares and total voting power until May 2019.  During the beginning of the 
relevant period prior to 2014, iHeartMedia was named CC Media Holdings, Inc.  

 
 
1 The findings herein are made pursuant to Respondent’s Offer of Settlement and are not binding on any other 
person or entity in this or any other proceeding. 
2 During the beginning of the relevant period prior to 2014, the iHeartMedia subsidiary which owned CCOH’s 
shares was named Clear Channel Communications, Inc.  



   
 

3 
 

 
4. Clear Channel International (“CCI”) was, during the relevant period, a CCOH 

division based in London, England.   
 

5. Clear Media Limited was, during the relevant period, a Bermuda-incorporated 
holding company, headquartered in Guangzhou, China, through which CCOH conducted business 
in China.  Since 2005, Clear Media Limited was majority-owned by CCOH.  Since December 
2001, Clear Media Limited listed a portion of its shares on the Hong Kong Stock Exchange.  Clear 
Media Limited, in turn, operated through a joint venture entity (together, “Clear Media”) between 
Clear Media Limited and a PRC-incorporated company controlled by Related Group (“JV 
Partner”).  Clear Media’s books and records were consolidated into CCOH’s consolidated 
financial statements for purposes of Commission filings through fiscal year 2020, when CCOH 
sold its interest in the Clear Media business. 

 
6. Related Group was, during the relevant period, a group of companies operating in 

China that were controlled by Executive A’s close family member (“Executive A’s Relative”) and 
included, among others, JV Partner and various cleaning and maintenance entities used by Clear 
Media. 

 
7. Executive A, a Chinese citizen and resident, was, during the relevant period, Clear 

Media’s principal executive officer. 
 

8. Executive B, a Singaporean citizen and Chinese resident, was, during the relevant 
period, a senior executive officer of Clear Media.  
 

FACTS 
 

Background: CCOH’s control over Clear Media 
    

9. CCOH acquired an interest in certain advertising companies associated with 
Executive A and Executive A’s Relative in China in 1998.  In 2001, Clear Media Limited listed its 
shares on the Main Board of the Stock Exchange of Hong Kong Limited, and CCOH reorganized 
its holding through Clear Media.  From 2005 through March 2020, CCOH held a majority of Clear 
Media’s shares.  CCOH provided out-of-home advertising services in China solely through Clear 
Media and, through CCI, consolidated Clear Media’s results in its financial statements.  

  
10. During the relevant period, Executive A served as Clear Media’s principal 

executive officer.  CCOH exercised control of Clear Media through the participation of two to 
three executives on Clear Media’s board of directors, including in positions as Executive Chairman 
and Deputy Chairman of its board.   Executives from CCOH’s finance, legal, and compliance 
functions also participated regularly in Clear Media’s board meetings, as well as in certain Clear 
Media audit committee meetings.    

 



   
 

4 
 

11. CCOH controlled the majority of voting shares of Clear Media.  CCOH set 
financial goals for Clear Media; supervised Clear Media’s financial performance, management, 
and organization; and defined Clear Media management’s scope of responsibility.  Using U.S.-
based email systems, CCOH executives approved Clear Media’s budget and significant 
transactions, including tenders for concessions.  CCOH also controlled the adoption of Clear 
Media’s compliance policies and the hiring, firing, and compensation of Executive A and other 
Clear Media executives.  Clear Media reported to CCOH through the Executive Chairman of Clear 
Media’s board of directors, a role filled by a CCOH executive for Asia Pacific from 2012 until 
2015.  Thereafter, the Executive Chairman of Clear Media’s board reported to CCOH’s head of the 
CCI division.  CCOH conducted annual audits of Clear Media, including compliance, operational, 
and SOX audits.  
 

Clear Media made improper payments to obtain and retain business in China  
and inaccurately documented and recorded the payments. 

 
12. From at least 2012 through 2017, acting directly and through third parties, Clear 

Media provided improper benefits to obtain and renew concessions and advertising contracts in 
China and failed to appropriately document and record those payments in its books and records.   

 
13. To obtain concession contracts from local Chinese government transport 

authorities, Clear Media provided cash-equivalent gift cards, golf clubs, vases, and other expensive 
and unidentified gifts and entertainment, some of which were provided “due to being in the 
negotiation process with clients for a renewal.”  Executive A spent hundreds of thousands of 
dollars, subject to no advance review or approval, on government officials for first-class travel, 
hotel rooms, meals, and entertainment.  Clear Media’s documentation often failed to identify the 
officials who received the benefits or to specify the amount spent on each official’s behalf.  In one 
instance in September 2015, Clear Media employees were cautioned by local Clear Media 
management not to “describe the purposes of the Hospitality Costs too specifically, e.g., for the 
purpose of winning the contract.”    
  

14. Clear Media also provided improper benefits to government officials through 
vendors known as “cleaning and maintenance entities,” which helped obtain Clear Media’s 
concession contracts as well as build, clean, and maintain its advertising displays.  Many of Clear 
Media’s cleaning and maintenance vendors were Related Group companies.  Contrary to Clear 
Media’s policies, Clear Media made certain payments to the cleaning and maintenance entities 
based solely on oral agreements, often disguising payments for the benefit of government officials 
as various “subsidies” or “special request” expenses.  Written contracts Clear Media had with such 
entities often lacked specificity as to payment rates and amounts, and certain contracts did not have 
anti-corruption provisions or audit rights, contrary to Clear Media’s policies.  Further, the cleaning 
and maintenance entities did not detail the services they provided, as Clear Media’s policies 
required before paying vendors.   
 

15. In addition to cleaning and maintenance expenses, the budget Clear Media allocated 
to cleaning and maintenance entities included salaries, bonuses, entertainment, and other expenses.  



   
 

5 
 

Records indicate that Clear Media also maintained an annual reserve of $525,000 to $600,000 for 
“special funding” or “special request funding” for ad hoc requests, and that “from discussions in 
Hangzhou [in 2017,] special request funding ha[d] been used [in Hangzhou] solely for Government 
official entertaining.”3 
  

16. In December 2016, Clear Media’s Hangzhou branch spent $12,800 on customer 
entertainment while it was seeking the renewal of a priority concession with a Hangzhou transit 
authority (the “Hangzhou Concession”).  In January 2017, Clear Media provided its Hangzhou 
branch with approximately $14,000 to entertain government officials “due to the need to 
renegotiate” the Hangzhou Concession.  Clear Media’s Hangzhou branch then transferred 
approximately $20,350 to its cleaning and maintenance entity, classifying the payment as a 
“subsidy” or an “allowance.”  The same month, the Hangzhou Concession was renewed.    

 
17. Similarly, the general manager of Clear Media’s cleaning and maintenance entity in 

Shanghai told CCOH’s internal auditors during a 2017 audit that his main responsibility, along 
with Executive A, was to maintain a “close relationship” with Shanghai government officials, 
including through entertainment, in order to avoid having the Shanghai concession put out for 
public tender.  He stated that Clear Media would lose the concession in an open tender because it 
was unable to compete based on price.  Clear Media entered into a ten-year concession agreement 
with Shanghai public transit authorities in December 2016.   

 
18. In addition to improper payments made to obtain concession contracts, Clear Media 

engaged in a “customer development expense” scheme from at least 2013 through 2017.  Through 
this scheme, Clear Media developed an off-book cash fund for payments made to undisclosed 
consultants to win, grow, or retain advertising business from approximately 70 private and 
government customers.  Clear Media purportedly considered the identities of the consultants to be 
sensitive and confidential information and did not properly diligence or document them.  In some 
cases, Clear Media withdrew cash directly from its bank account for personnel to pay the 
undisclosed consultants.  In others, Clear Media created false invoices and tax records to justify 
cash payments to three shell company intermediaries that provided no actual services.  The shell 
companies, whose legal representatives included Executive A’s driver and personal assistant, were 
controlled by Related Group.  After a series of cash deposits and withdrawals through layers of 
bank accounts held in the names of employees of Clear Media and Related Group companies, 
Clear Media sales directors distributed the cash to 19 different undisclosed consultants.  The 
payments ranged from two to five percent of the advertising contracts’ value.  Clear Media had no 
written agreements with the consultants or records of the payments made to them.  
 

 
 
3 All U.S. dollar payment amounts and other U.S. dollar figures relating to Clear Media identified in this Order were 
converted from Chinese RMB or the Hong Kong Dollar at the exchange rate prevailing at the relevant time. 



   
 

6 
 

From 2012 through 2017, CCOH’s internal auditors identified  
bribery-related concerns and internal accounting control deficiencies at Clear Media. 

 
19. From 2012 through 2017, CCOH’s internal auditors repeatedly reported elevated 

bribery risks at Clear Media and concerns regarding Clear Media’s compliance program and 
internal accounting controls, including in relation to cleaning and maintenance vendors; travel, 
gifts, and entertainment; compliance training; and whistleblower hotline implementation.  While 
CCOH audit reports identified certain remedial actions to be taken by Clear Media, CCOH failed 
to ensure that Clear Media took adequate steps to sufficiently address these repeated concerns.  In 
some cases, CCOH’s internal auditors erroneously reported that audit issues were remediated 
based on information provided by Clear Media, only to note the same issues in later audits; failed 
to elevate certain concerns they identified at Clear Media; and failed to adequately test high-risk 
transactions to detect long-running payment schemes.   
 

20. In 2012, CCOH’s internal auditors reported that Clear Media had made 
discretionary payments to cleaning and maintenance entities in China that could not be traced to 
written contracts.  Clear Media also paid the majority of the salaries of the entities’ senior 
management.  Although Clear Media was using the cleaning and maintenance entities to interface 
with government officials, it required no compliance representations or training for the employees 
of these entities.  CCOH Internal Audit also flagged Clear Media’s failure to implement a 
whistleblower hotline.   
 

21. In 2013, CCOH’s internal auditors reported that the issues raised in their 2012 
compliance audit had been addressed by Clear Media management, without describing how certain 
issues, some of which became the subject of repeat audit findings in 2014 and 2015, were resolved.  
Similarly, in 2014, CCOH’s internal auditors concluded, based solely on assertions by certain 
Clear Media managers, that Clear Media used no intermediaries for dealings with municipal 
governments.  In fact, however, Clear Media was making substantial ongoing payments to cleaning 
and maintenance entities, which past internal audits had found interacted with local officials on 
Clear Media’s behalf.  Nevertheless, in September 2014, CCOH’s internal auditors assigned Clear 
Media a “marginal” rating due to concerns related to gifts and entertainment for government 
officials, among other issues, and recommended that expense approval and documentation 
processes and procedures be improved at Clear Media.    

 
22. In connection with a 2015 specific scope audit focusing on the company’s Shanghai 

branch, CCOH’s internal auditors found that Clear Media continued to pay cleaning and 
maintenance entities at undocumented rates based on oral agreements and to employ the entities’ 
senior management, and their Audit Report recommended that contracts going forward formally 
document rates payable to the entities.  In a subsequent 2015 compliance audit, the auditors 
reported that some gifts and entertainment Clear Media provided to government officials may 
violate relevant anti-corruption laws.  Examples included a set of gifts provided “due to being in 
the negotiation process with clients for a renewal,” as well as cash-equivalent gifts, golf clubs, and 
other items provided at the request of government officials.  In its Audit Report, CCOH’s internal 
auditors recommended that Clear Media create a clear policy governing appropriate gift and 



   
 

7 
 

hospitality practices, to be agreed to and monitored by CCOH compliance and Clear Media’s local 
compliance officer.  

 
23. CCOH’s internal auditors reported to CCOH’s management or audit committee in 

2015, 2016, and 2017 that some of Clear Media’s gift and entertainment expenses for government 
officials may be “problematic” or “high risk” under applicable anti-corruption laws and carried 
risks of fines and reputational damage.  A 2016 Audit Report also flagged gaps in Clear Media’s 
provision of compliance training below the senior management level and in publicizing its 
whistleblower hotline, while the auditors failed to perform any testing of Clear Media’s due 
diligence files and contracts to verify the accuracy of Clear Media’s assertions about its use of third 
parties, contrary to their standard testing protocol.   

 
24. Following three “marginal” compliance ratings in three years, Clear Media entered 

a cycle of “unsatisfactory” audit findings beginning in 2017 based primarily on continued concerns 
about cleaning and maintenance vendors.  A January 2017 report issued by Clear Media’s internal 
auditor, reviewed by CCOH’s internal auditors and a CCI executive, reported that the cleaning and 
maintenance entities’ government interactions included obtaining approvals and negotiating 
penalties and concession contracts for Clear Media.  Despite the elevated corruption risks of this 
relationship, Clear Media’s payments to the entities included “special request expenses” and 
“allowances” intended to enable the entities “to maintain or build[] up relationships with local 
authorities.”  Clear Media also subsidized the entities’ salary and rent, purchased their vehicles, 
and provided bonuses and trips for their personnel.  Cleaning and maintenance agreements 
automatically renewed without due diligence or competitive bidding.   

 
25. In 2017, during a specific scope audit focusing on Clear Media’s Shanghai and 

Hangzhou branches, CCOH’s internal auditors also noted concerns in their work papers about the 
significant entertainment expenditures for Hangzhou government officials “due to the need to 
renegotiate” the Hanghzhou Concession in early 2017.  These specific concerns were not reflected 
in the summary report provided to CCOH’s management and presented to CCOH’s audit 
committee.   

 
In 2017, Clear Media blocked CCOH’s internal auditors’ access to records. 

 
26. Given the risks surrounding Clear Media’s payments to cleaning and maintenance 

entities, in 2017, CCOH’s internal auditors requested support concerning the entities’ monthly 
expenditures, as well as for the payments made to entertain officials renegotiating the Hangzhou 
Concession in early 2017.  Executive A blocked CCOH’s internal auditors, Clear Media’s internal 
auditor, and Executive B from obtaining access to the requested records.     

 
27. Following the 2017 audit, CCOH’s internal auditors raised concerns about access to 

records with Clear Media management and with Clear Media’s Chairman of the Board and Audit 
Committee Chair.  Executive A’s actions were then reported to CCOH’s senior executives and 
audit committee.  CCOH’s internal auditors assigned Clear Media an “unsatisfactory” audit rating 



   
 

8 
 

due largely to CCOH’s internal auditors’ inability to provide assurance on the appropriateness or 
validity of Clear Media’s payments to cleaning and maintenance vendors. 
 

In 2018, a misappropriation scheme came to light, revealing additional  
weaknesses in Clear Media’s internal accounting controls. 

 
28. In January 2018, a Clear Media cashier confessed to Chinese authorities that he had 

participated in a decade-long misappropriation scheme.  Clear Media’s board engaged local 
counsel and the Hong Kong branch of an accounting firm to investigate the misappropriation.  In 
February 2018, Clear Media’s external auditors also identified suspicious commission payments 
made to entities related to Executive A.  Clear Media’s investigation found that: 
 

• Between 2007 and 2017, at least three Clear Media employees engaged in a 
series of unrecorded and allegedly unauthorized transactions to 
misappropriate approximately USD $10.2 million;  

 
• Between 2011 and 2018, undisclosed, “off-book” bank accounts in Clear 

Media’s name were used to receive government subsidies totalling at least 
USD $5.2 million that were not recorded as income; and 

 
• Between at least 2015 and 2017, Clear Media made approximately USD 

$9.8 million in cash “customer development” payments, both through Clear 
Media personnel and Related Group shell companies, to 19 secret 
consultants to obtain or retain business with approximately 70 government 
and private customers.    

 
29. Executive A prevented investigators from interviewing Related Group employees 

regarding the “customer development” expenses and from accessing its records.  Clear Media 
eventually permitted external legal counsel in China to contact five of the 19 consultants by 
telephone, all of whom denied making improper payments.  Investigators had no access, however, 
to the secret consultants’ books and records to verify how the “customer development” fees were 
used.   

 
30. While CCOH did not become aware of the “customer development” expense 

scheme until 2018, later investigation revealed that Clear Media’s payments to secret consultants 
began no later than 2013.  CCOH’s monitoring of Clear Media failed to detect the repeated, large 
cash withdrawals and commission payments that Clear Media made for at least five years, from 
2013 through 2017, in furtherance of the “customer development” scheme.   

 
31. At the same time, as of 2018, many of the issues CCOH’s internal auditors did 

identify in audits of Clear Media since 2012 remained insufficiently or only partially remediated by 
Clear Media.  For example, a compliance questionnaire Clear Media completed in March 2018 
reflected that Clear Media did not conduct due diligence on agents, did not require approval of new 
suppliers before processing payments to them, did not obtain required legal department approval of 



   
 

9 
 

related party transactions, did not include CCOH’s anti-bribery contractual provisions and audit 
clauses in its model contracts, and did not publicize the CCOH whistleblower hotline. 
 

32. In March 2018, Clear Media provided information regarding its investigation to the 
Hong Kong Stock Exchange, which temporarily suspended trading in Clear Media securities in 
April 2018.  CCOH made a parallel disclosure to the Commission in anticipation of a delayed 
filing of its annual report.  About the same time, the Hong Kong office of CCOH’s external 
auditors disclaimed its 2017 audit opinion of Clear Media’s financials.  CCOH’s external auditors 
in the United States determined that Clear Media’s internal control over financial reporting had a 
material weakness related to approvals and segregation of duties within cash management and 
banking processes.  Gaps surrounding vendor payments and cash disbursement were deemed a 
significant deficiency.  
 

33. To remediate these issues, Clear Media engaged an accounting firm (“Accounting 
Firm”) to review its internal control over financial reporting.  Accounting Firm’s September 2018 
recommendations were similar to those CCOH’s internal auditors had made from 2012 to 2017 
regarding Clear Media’s governance of supplier management, conflicts of interest, related party 
transactions, employee expense claims, and whistleblowing.  Accounting Firm’s recommendations 
also addressed Clear Media’s “customer development” expenses and internal audit function. 

 
Throughout 2019, Clear Media continued to block access to financial records  

and pay cleaning and maintenance entities without adequate support. 
 

34. Executive A continued to deny CCOH’s internal auditors access to financial 
records related to the cleaning and maintenance entities’ expenses in 2019.  CCOH’s internal 
auditors reported this to their executive management, along with continuing concerns regarding 
Clear Media’s whistleblowing hotline implementation and provision of meals and entertainment.   
 

35. Accounting Firm assigned Clear Media “unsatisfactory” ratings in two internal 
audits it conducted in 2019.  Accounting Firm found that Clear Media continued to pay substantial 
“business development assistance fees” to cleaning and maintenance entities related to acquiring or 
renewing concession rights; there were no formal contractual agreements in respect to these 
services or bases to support the amounts paid.  Accounting Firm concluded that these payments 
created a “critical risk” to Clear Media’s operational performance, financial statements, and 
reputation or could result in legal fines and penalties.  Accounting Firm further found a high risk 
associated with Clear Media’s payments to the entities to clean and maintain bus shelters, which 
also lacked an adequately documented basis, and recommended clarification of pricing models and 
monitoring of payments for appropriateness.     
 

36. In May 2019, CCOH legally separated from its former ultimate parent company, 
had a new class of stockholders, and formed a new board of directors.  Despite various remedial 
efforts, by the end of 2019, CCOH still could not assure itself that Clear Media’s payments to 
cleaning and maintenance entities were being spent appropriately, consistent with CCOH 
management’s policies, and in compliance with anti-corruption laws.  In November 2019, CCOH 



   
 

10 
 

announced a strategic review of its interest in Clear Media.  In March 2020, CCOH disposed of its 
interest in Clear Media.  
 

LEGAL STANDARDS AND VIOLATIONS 
 

37. Under Exchange Act Section 21C(a), the Commission may impose a cease-and-
desist order upon any person who is violating, has violated, or is about to violate any provision of 
the Exchange Act or any regulation thereunder, and upon any other person that is, was, or would 
be a cause of the violation, due to an act or omission the person knew or should have known would 
contribute to such violation. 

 
38. As a result of the conduct described above, Respondent violated Section 30A of the 

Exchange Act, which prohibits any issuer with a class of securities registered pursuant to Section 
12 of the Exchange Act or with reporting obligations pursuant to Section 15(d) of the Exchange 
Act, or any officer, director, employee, or agent of such issuer, or any stockholder acting on behalf 
of an issuer, from making use of the mails or any means or instrumentality of interstate commerce 
corruptly in furtherance of an offer, payment, promise to pay, or authorization of the payment of 
any money, or offer, gift or promise to give anything of value to any foreign official, for purposes 
of influencing any act or decision of such foreign official in his official capacity in order to assist 
such issuer in obtaining or retaining business for or with any person. 
 

39. As a result of the conduct described above, Respondent violated Section 
13(b)(2)(A) of the Exchange Act, which requires issuers with a class of securities registered 
pursuant to Section 12 of the Exchange Act and issuers with reporting obligations pursuant to 
Section 15(d) of the Exchange Act to make and keep books, records, and accounts, which, in 
reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the 
issuer. 
 

40. As a result of the conduct described above, Respondent violated Section 
13(b)(2)(B) of the Exchange Act, which requires issuers with a class of securities registered 
pursuant to Section 12 of the Exchange Act and issuers with reporting obligations pursuant to 
Section 15(d) of the Exchange Act to devise and maintain a system of internal accounting controls 
sufficient to provide reasonable assurances that (i) transactions are executed in accordance with 
management’s general or specific authorization; (ii) transactions are recorded as necessary (I) to 
permit preparation of financial statements in conformity with generally accepted accounting 
principles or any other criteria applicable to such statements, and (II) to maintain accountability for 
assets; (iii) access to assets is permitted only in accordance with management’s general or specific 
authorization; and (iv) the recorded accountability for assets is compared with the existing assets at 
reasonable intervals and appropriate action is taken with respect to any differences. 
 

Disgorgement and Civil Penalties 
 

41. The disgorgement and prejudgment interest referenced in Section IV below is 
consistent with equitable principles, does not exceed Respondent’s net profits from its violations, 



   
 

11 
 

and returning the money to Respondent would be inconsistent with equitable principles.  
Therefore, in these circumstances, distributing disgorged funds to the United States Treasury is the 
most equitable alternative.  The disgorgement and prejudgment interest referenced in Section IV 
below shall be transferred to the general fund of the United States Treasury, subject to Section 
21F(g)(3) of the Exchange Act. 
 

Cooperation and Remediation 
 

42. In determining to accept the Offer, the Commission considered CCOH’s 
cooperation and remedial efforts.   

 
43. CCOH’s cooperation included: (1) promptly sharing facts developed in its own 

internal investigation; (2) proactively producing relevant documents, including documents from 
Clear Media, both prior to and following the sale of CCOH’s interest in Clear Media, that were 
located overseas; (3) producing, in real time, documentation of audits of Clear Media internal 
controls during the course of the investigation; (4) providing translations of documents; (5) 
facilitating the production of documents from third parties; and (6) facilitating the Commission’s 
staff’s interviews of current and former employees of CCOH’s foreign subsidiaries and of certain 
third parties.  
 

44. CCOH’s remediation efforts include:  (1) disposing of its interest in Clear Media; 
(2) enhancing CCOH’s anti-corruption compliance policies, procedures, and related internal 
accounting controls surrounding third-party due diligence, contracting, payments, and monitoring; 
gifts, meals, entertainment, and travel; conflicts of interest; and the monitoring and remediation of 
internal audit issues and actions; (3) implementing annual compliance reviews of internal 
accounting controls across its business units; (4) increasing human and financial resources for 
compliance, including the hiring of a dedicated Compliance Director; (5) introducing ethics and 
compliance considerations into performance evaluations and compensation decisions; and (6) 
enhancing online and live anti-corruption training programs.   
   

IV. 
 

 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 
agreed to in Respondent’s Offer. 
 
 Accordingly, it is hereby ORDERED that: 
 
 A. Pursuant to Section 21C of the Exchange Act, Respondent cease and desist from 
committing or causing any violations and any future violations of Sections 30A, 13(b)(2)(A), and 
13(b)(2)(B) of the Exchange Act.   
 
 B. Respondent shall pay disgorgement of $16,355,567, prejudgment interest of 
$3,760,920, and a civil monetary penalty in the amount of $6,000,000 to the Securities and 
Exchange Commission for transfer to the general fund of the United States Treasury, subject to 



   
 

12 
 

Exchange Act Section 21F(g)(3).  Respondent shall pay $13,058,243.50 within 30 days after entry 
of the Order; and the remaining balance in one-third equal installments under the following 
schedule: 305 days, 335 days, and 365 days after the entry of the Order until the full amount and 
interest is paid.  Payments shall be applied first to post-order interest, which accrues pursuant to 
SEC Rule of Practice 600 and 31 U.S.C. § 3717.  Prior to making the final payment set forth herein, 
Respondent shall contact the staff of the Commission for the amount due.  If Respondent fails to 
make any payment by the date agreed and/or in the amount agreed according to the schedule set 
forth above, all outstanding payments under this Order, including post-order interest, minus any 
payments made, shall become due and payable immediately at the discretion of the staff of the 
Commission without further application to the Commission. 
 
 C. Payment must be made in one of the following ways:   
 

(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  

 
(2) Respondent may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondent may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  

 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 

 
Payments by check or money order must be accompanied by a cover letter identifying 

CCOH as a Respondent in these proceedings, and the file number of these proceedings; a copy of 
the cover letter and check or money order must be sent to Charles Cain, Chief, FCPA Unit, 
Division of Enforcement, Securities and Exchange Commission, 100 F St., NE, Washington, DC 
20549-5631.   
 
 D. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes.  To 
preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 
Action (as defined herein), it shall not argue that it is entitled to, nor shall it benefit by, offset or 
reduction of any award of compensatory damages by the amount of any part of Respondent’s 
payment of a civil penalty in this action (“Penalty Offset”).  If the court in any Related Investor 
Action grants such a Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a 
final order granting the Penalty Offset, notify the Commission’s counsel in this action and pay the 
amount of the Penalty Offset to the Securities and Exchange Commission.  Such a payment shall 



   
 

13 
 

not be deemed an additional civil penalty and shall not be deemed to change the amount of the civil 
penalty imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” 
means a private damages action brought against Respondent by or on behalf of one or more 
investors based on substantially the same facts as alleged in the Order instituted by the 
Commission in this proceeding. 
 
 By the Commission. 
 
 

Vanessa A. Countryman 
Secretary 

 


	UNITED STATES OF AMERICA
	In the Matter of
	CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
	Respondent.
	IV.