In re KT CORPORATION

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UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 94279 / February 17, 2022 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-20780 
 
In the Matter of 
 
KT CORPORATION,  
 
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 KT Corporation (“KT” or “Respondent”).   
 
II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “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.   
 
 
 
 
 

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III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds
1
 that:  
 
SUMMARY 
 
1. This matter arises out of KT Corporation’s (“KT”) violations of the books and 
records and internal accounting controls provisions of the Foreign Corrupt Practices Act of 1977 
(the “FCPA”) [15 U.S.C. 78dd] in the Republic of Korea and Vietnam.  KT lacked sufficient 
internal accounting controls over expenses, including executive bonuses and purchases of gift 
cards, which enabled managers and executives to generate slush funds.  In addition, the misconduct 
involved former high-level managers and executives and occurred under circumstances whereby 
KT had no relevant anti-corruption policies or procedures with respect to donations, employment 
candidates, vendors, subcontractors, or third-party agents.  In certain instances, this allowed KT 
employees to provide benefits improperly to government officials and to seek business from 
government customers.  As a result of this misconduct, KT violated the books and records and 
internal accounting controls provisions of the FCPA. 
 
RESPONDENT 
 
2. KT Corporation (“KT”) is South Korea’s largest comprehensive 
telecommunications operator, with its principal executive offices in Seoul, South Korea.  KT’s 
American Depositary Shares are registered with the Commission pursuant to Section 12(b) of the 
Exchange Act and trade on the New York Stock Exchange.  KT files periodic reports, including 
Form 20-F, with the Commission pursuant to Section 13(a) of the Exchange Act and related rules 
thereunder. 
 
FACTS 
 
Conduct in Korea 
 
Slush Funds 
 
3. From at least 2009 through 2017, high-level executives of KT maintained slush 
funds, comprised of both off-the-books accounts and physical stashes of cash, in order to provide 
items of value to government officials, among others.  These included gifts, entertainment and, 
ultimately, illegal political contributions to members of the Korean National Assembly serving on 
committees relevant to KT’s business.  
 
4. From 2009 to 2013, a KT then-Executive Officer and another KT senior executive 
orchestrated a scheme through which the Executive Officer approved inflated bonuses to company 
                                                 
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.   
 

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officers and executives, which was then returned to the Executive Officer in cash and used to 
generate a slush fund of approximately $1 million.  Some of the funds were held in a KT 
executive’s personal bank account, while the cash was stored in a safe on the sixteenth floor of 
KT’s offices in Bundang.  The Executive Officer used the cash as a slush fund for gifts to, among 
others, government officials with the ability to influence KT’s business.  No one at KT maintained 
records of the recipients of the gifts, although other KT executives knew about the conduct.  KT 
booked the slush fund amounts as executive bonuses, even though the money was used for gifts 
and for payments to government officials.   
 
5. In October 2013, there were media reports about the bonus scheme, resulting in the 
resignation of the Executive Officer in November 2013 and criminal charges
2
 in April 2014.  As a 
result, the bonus scheme became impossible to maintain.  Rather than cease the misconduct and 
institute improved internal accounting controls to detect and prevent such schemes in the future, 
KT officials instead devised a new method to continue generating a slush fund.  From 2014 to 
2017,  KT’s Corporate Relations (“CR”) Group purchased gift cards, which were then converted to 
cash and used for a new slush fund.  On numerous occasions, a CR senior manager (“Manager A”) 
told a CR midlevel manager (“Manager B”) how much cash to obtain.  In response, using an 
internal purchasing system, Manager B purchased gift cards from a particular vendor (“Vendor”).  
When buying gift cards to convert to cash, Manager B inserted a tag phrase, “CR Case 
Benchmarking,” in the purchasing system as the purported purpose for the purchase.   
 
6. When the cash was ready, Vendor called Manager B as he arrived outside the KT 
office building where Manager B worked.  Manager B then met Vendor in a van in the parking lot 
next to the KT building.  Vendor gave Manager B a paper bag containing a large manila envelope 
of cash, corresponding to the value of the gift cards purchased, less a commission for Vendor.  
Manager B then gave the cash to Manager A, who placed it in a double-locking cabinet. 
 
7. Over time, Manager A passed the cash to KT officers and managers, with the 
understanding that they would transfer the funds electronically to the  contributions accounts for 
various Korean lawmakers.  Once the transfer was made, a CR employee would inform the 
particular lawmaker’s aide that the contribution came from KT.  This scheme was used  to evade 
Korea’s Political Funds Act, which prohibits corporations from making political contributions.  
Most of the funds went to lawmakers in the National Assembly who sat on committees with the 
ability to impact the telecommunications industry and KT’s business.   
 
8. The individual contributions ranged from KRW 1M ($893) to KRW 14M 
($12,500).  KT ranked the lawmakers (A, B, and C) according to the amounts that the CR Group 
anticipated spending on each one.  CR managers reported the amounts and recipients of the 
contributions to upper management. The political contributions amounted to approximately 
$393,574,and were given to 99 Korean lawmakers and candidates.  The CR Group generated an 
additional $910,211 for improper gift and entertainment expenses, for a combined total for the 
slush fund of $1.3 million.  
 
                                                 
2
  After multiple appeals, the Executive Officer was found not guilty of embezzlement from KT, on the 
ground that he used much of the slush fund for the benefit of  KT, rather than for personal use. 

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9. KT booked the gift card expenses used to fund the slush fund as either “research 
and analysis” or “entertainment,” which was inaccurate or did not fairly reflect the transactions.  In 
November 2021, Korean authorities indicted KT and fourteen high-level executives for criminal 
violations in connection with the gift card scheme. 
 
Payments at the Behest of Government Officials  
 
10. Between 2015 and 2016, KT made payments of over $1.6 million to three 
organizations at the request of high-level government officials.  KT paid $972,616 to Foundation 
A, described as a foundation for the promotion of Korean culture, and $603,791 to Foundation B, 
described as a foundation for the promotion of sports.  A close associate of a senior Korean 
government official set up both foundations, and the payments were made at the behest of the Blue 
House, Korea’s presidential residence and office.  The third payment, of $88,420 to another 
organization, Association C concerning e-Sports, was solicited by a member of Korea’s National 
Assembly who served on legislative committees important to KT's business.  All of these payments 
were booked incorrectly, either as charitable donations or as a sponsorship. 
 
11. Despite the circumstances – direct requests for payment coming from or on behalf 
of high government officials – KT took no steps to determine if the payments were legitimate 
donations, rather than illicit payments made at the behest of government officials.  Further, neither 
Foundation A nor B was established when the donation request was made or when KT managers 
agreed to make the payments.   
 
12. In 2015 and 2016, a Blue House official urged, and KT senior management agreed, 
to hire two advertising executives with personal connections to the Blue House and then, once 
hired, transferred them to more desirable positions.  KT also altered its criteria for outside 
advertising agencies in order to hire a new agency established by the same close associate of a high 
Blue House official who had established Foundation A and Foundation B.  The requesting Blue 
House official was clear with KT senior management that “the VIP” – whom KT officials 
understood was the Blue House official’s ultimate boss – “had major concerns about KT’s 
advertisements” and that these moves were “important to the VIP.”  Notwithstanding these 
circumstances, and without conducting due diligence on the individuals or the agency, KT paid the 
two individuals a total of $454,009 in salaries and the advertising firm a total of $5.88 million in 
fees. 
 

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Conduct in Vietnam 
 
13. Between 2014 and 2018, KT employees internally discussed providing money to 
third parties connected to government officials in Vietnam in order to obtain contracts for two 
projects.  The first project was with the People’s Committee of Quang Binh province in Vietnam to 
construct a solar cell power system (“Solar Power Project”), and the second was with the Vietnam 
Ministry of Labor, Invalids and Social Affairs to provide hardware, software, and training for five 
vocational colleges (“Vocational Colleges Project”).  At the time, KT lacked sufficient internal 
accounting controls regarding third parties and no relevant compliance policies regarding due 
diligence.  Moreover, KT took no meaningful steps in response to allegations of improper 
payments in connection with the contracts. 
 
Solar Power Project 
 
14. In 2014, KT entered into an arrangement with a construction company to pay a 
bribe of $95,031 to a high-level official of Vietnam’s Quang Binh province in order to obtain the 
contract for the Solar Power Project.  On September 10, 2014, a junior employee in KT’s Hanoi 
office told an employee of a subcontractor to the construction company, “KT Hanoi will handle the 
matter of deliver[ing] money to the right person.  Only KT Hanoi office now can handle this matter 
because others couldn’t make it.  We will do it in the right way and make it work.  So please 
arrange to transfer the money within today or before next Monday.”  
 
15. The construction company wired money to the employee’s bank account, which the 
employee then withdrew as cash.  The employee and a construction company subcontractor 
representative traveled to the Sun Spa resort in Quang Binh, where the government official 
received the money.  Subsequently, a member of the sales team described the payment as “a rebate 
to the project owner.” 
 
16.  In 2018, the construction company sought reimbursement from KT for the bribe 
payment, described as “expenses for engaging in sales activities with the ordering organization . . .  
($95K),” as well as other expenses.  KT paid the construction company approximately $200,000 to 
settle all the claims, including reimbursement for the bribe payment, and it booked the payment as 
“Support/consulting for performance of the business (completed).” 
 
17. As part of the Solar Power Project, the government customer contracted to pay KT 
an advance payment in January 2015.  As of March 2015, the government customer had not made 
the payment, due to delays in the Ministry of Finance.  A KT senior vice-president (“SVP”) 
instructed a senior employee in the Hanoi office “to give money to the public officials so that they 
can speed up the performance of their duties.”  Using a KT Hanoi office credit card, the senior 
employee conducted four cash-back transactions at a Hanoi restaurant, and he used the cash to pay 
the Ministry officials approximately $3,000.  The effort was successful and resulted in the 
government transmitting the advance payment to KT.   
 

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Vocational Colleges Project 
 
18. In 2013-2014, KT participated with a consortium to bid on the Vocational Colleges 
Project.  The customers were the Vietnam Ministry of Labor, Invalids and Social Affairs 
(“MOLISA”) and the General Department of Vocational Training (“GDVT”).  The Project 
Management Unit (“PMU”) within MOLISA coordinated the project. 
 
19.   A high-level official at GDVT (“Official 1”) introduced KT to a Vietnamese 
company to serve as a local agent.  KT learned ”[t]he possibility of winning the business appears 
higher when using the company designated by [Official 1] as the local agent in the bid.”  In 
addition, KT learned from its original consortium partner (“Partner 1”), which was to pay the agent 
fee, that 10% of the project cost would go to the agent, who would pass on 7% of the project cost 
to Official 1.  Pre-bid, the agent served as a communication channel between KT’s consortium and 
government officials. 
 
20. In May 2015, Partner 1 informed KT that it did not want to be responsible for the 
agent’s fee due to the risk involved.  KT agreed to reorganize the consortium and assume 
responsibility for paying the agent’s fee.  KT and the agent agreed that the fee would be 8.5%, 
which included $550,000 for Official 1, who planned to retire soon and did not want to wait for the 
project to be completed before receiving his share.   
 
21. KT arranged for a subcontractor in the consortium to become a consortium partner, 
as well (“Partner 2”), and KT tasked Partner 2 with the responsibility of paying the agent fee.  The 
purpose of the arrangement was to distance KT from the agent, as well as to conceal the agent from 
KT’s agent review process. While the agent review process was a financial risk review, not an 
anticorruption review, the KT managers involved preferred to avoid any questions about KT’s 
relationship with the agent.  Paying the agent through Partner 2 enabled KT managers to bypass the 
review. 
 
22. On May 19, 2015, Partner 2 sent KT a quotation that included “Site survey and 
Local legal & Technical Consulting.”  Within this item, Partner 2 listed the agent fee of 
approximately $735,000, cloaked as “Site survey for installation.”  The KT sales lead explained to 
the SVP, “As for the fee for the agent, . . . it would not be separately indicated . . . .  Instead. it will 
be included in the estimate for additional tasks based on [Partner 2]' s consent.”  Thus, KT 
managers understood that this fee was for the agent and that it was concealed to avoid review.  On 
May 28, 2015, KT executed the contract for the Vocational Colleges Project.   
 
23. When KT had difficulty with the government customer, it turned to the agent for 
assistance.  For example, on June 6, 2015, the SVP emailed the sales team: 
 
It is ridiculous that [GDVT] approval is going to take 1 week.  Through [the 
agent], make [a PMU official] get the approval in one day.  Do everything 
and anything to have this done.  . . . Immediately push them to prepare the 
required documents for the [GDVT] approval. Also use [the agent] when 
you do this. 

 7 
. . . .  
You need to discuss these matters tomorrow, Sunday. When it is difficult, 
use [the agent] to move [a PMU official]. 
 
At least one interim payment was made to the agent for these services.   
 
24. In January 2017, KT paid Partner 2 approximately $775,000 for undocumented 
“Consulting Service,” which was actually reimbursement for payments Partner 2 had made to the 
agent in order to bribe Official 1. 
 
LEGAL STANDARDS AND VIOLATIONS 
  
25. Under Section 21C(a) of the Exchange Act, 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 rule or 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. 
26. As a result of the conduct described above, KT violated Section 13(b)(2)(A) of the 
Exchange Act, which requires issuers to make and keep books, records, and accounts, which, in 
reasonable detail, accurately and fairly reflect the transactions and disposition of the assets of the 
issuer. [15 U.S.C. § 78m(b)(2)(A)]. 
27. Further, as a result of the conduct described above, KT violated Section 13(b)(2)(B) 
of the Exchange Act, which requires issuers 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.  [15 U.S.C. § 
78m(b)(2)(B)].  
COOPERATION AND REMEDIATION 
 
28. In determining to accept the Offer, the Commission considered those remedial acts 
undertaken by Respondent and the cooperation afforded the Commission staff.  KT did not self-
report the conduct described in this Order, but did cooperate with the Commission’s investigation 
by providing translations or summaries of some relevant documents, providing certain facts 
developed in its own internal investigation, and making certain current and former employees 
available to the Commission staff, including those who needed to travel to the United States. 
29. KT’s ongoing remedial efforts included termination of certain employees 
responsible for the misconduct and introducing enhancements to its internal accounting controls.  
KT strengthened its ethics and compliance organization; enhanced its code of conduct, and policies 

 8 
and procedures regarding expenses; and increased training of employees on anti-bribery issues.  
Nonetheless, KT continues to remediate its process around anticorruption risk-assessments, the 
effectiveness of its audit program, and other internal accounting controls relating to third parties 
and procedures for regular testing of its internal accounting controls. 
DISGORGEMENT AND CIVIL PENALTIES 
 
30. The disgorgement and prejudgment interest ordered in paragraph IV.C. is 
consistent with equitable principles, does not exceed Respondent’s net profits from its 
violations, and returning the money to Respondent would be inconsistent with equitable 
principles. Therefore, in these circumstances, distributing disgorged funds to the U.S. Treasury 
is the most equitable alternative. The disgorgement and prejudgment interest ordered in 
paragraph IV.C. shall be transferred to the general fund of the U.S. Treasury, subject to Section 
21F(g)(3) of the Exchange Act.   
 
UNDERTAKINGS 
 
 Respondent has undertaken to: 
 
1. During a two-year term as set forth below, Respondent shall report to the Commission 
staff periodically, at no less than six-month intervals, the status of its remediation and 
implementation of compliance measures.  During this two-year period, should 
Respondent discover credible evidence, not already reported to the Commission staff, 
that questionable or corrupt payments or questionable or corrupt transfers of value may 
have been offered, promised, paid, or authorized by Respondent, or any entity or person 
acting on behalf of Respondent, or that related false books and records have been 
maintained; or that Respondent’s internal controls failed to detect and prevent such 
conduct, Respondent shall promptly report such conduct to the Commission staff.  
 
2. During this two-year period, Respondent shall (1) conduct an initial review and submit an 
initial report, and (2) conduct and submit at least two follow-up reviews and reports, and 
(3) conduct and submit a Final Report, as described below: 
 
a. Respondent shall submit to the Commission staff a written report within 180 calendar 
days of the entry of this Order setting forth a complete description of its Foreign 
Corrupt Practices Act (“FCPA”) and anti-corruption related remediation efforts to 
date, its proposals reasonably designed to improve the policies and procedures of 
Respondent for ensuring compliance with the FCPA and other applicable 
anticorruption laws, and the parameters of the subsequent reviews (the “Initial 
Report”).  The Initial Report shall be transmitted to Tracy L. Price, Deputy Unit Chief, 
FCPA Unit, Division of Enforcement, United States Securities and Exchange 
Commission, 100 F St. NE, Washington, DC 20549-5631.  Respondent may extend 
the time period for issuance of the Initial Report with prior written approval of the 
Commission staff. 
 

 9 
b. Respondent shall undertake at least two follow-up reviews, incorporating any 
comments provided by the Commission staff on the previous report, to further monitor 
and assess whether the policies and procedures of Respondent are reasonably designed 
to detect and prevent violations of the FCPA and other applicable anti-corruption laws 
(the Follow-up Reports).  The first Follow-up Report shall be submitted by no later 
than 180 days after the Initial Report. The second Follow-up Report shall be submitted 
by no later than 360 days after the submission of the Initial Report.   
 
c. Respondent shall undertake a final review to further monitor and assess the operation 
of its FCPA and anti-corruption compliance program and whether Respondent’s 
policies and procedures are reasonably designed to detect and prevent violations of the 
FCPA and other applicable anti-corruption laws (the “Final Report”).  The Final 
Report shall be submitted by no later than 540 days after the submission of the Initial 
Report. Respondent may extend the time period for issuance of the Follow-up Reports 
with prior written approval of the Commission staff. 
 
3. The periodic reviews and reports submitted by Respondent will likely include 
confidential financial, proprietary, competitive business or commercial information. 
Public disclosure of the reports could discourage cooperation, impede pending or 
potential government investigations or undermine the objectives of the reporting 
requirement.  For these reasons, among others, the reports and the contents thereof are 
intended to remain and shall remain non-public, except (1) pursuant to court order, (2) as 
agreed to by the parties in writing, (3) to the extent that the Commission determines in its 
sole discretion that disclosure would be in furtherance of the Commission’s discharge of 
its duties and responsibilities, or (4) is otherwise required by law. 
 
4. Certify, in writing, compliance with the undertaking(s) set forth above.  The certification 
shall identify the undertaking(s), provide written evidence of compliance in the form of a 
narrative, and be supported by exhibits sufficient to demonstrate compliance.  The 
Commission staff may make reasonable requests for further evidence of compliance, and 
Respondent agrees to provide such evidence.  The certification and supporting material 
shall be submitted to Tracy L. Price, Deputy Unit Chief, FCPA Unit, with a copy to the 
Office of Chief Counsel of the Enforcement Division, no later than sixty (60) days from the 
date of the completion of the undertakings. 
 

 10 
IV. 
 
 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 
agreed to in Respondent KT’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 
13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act. 
 
 B. Respondent shall comply with the undertakings enumerated in Section III above. 
 
C. Respondent shall, within 30 days of the entry of this Order, pay disgorgement of 
$2,263,821, prejudgment interest of $536,457, and a civil money penalty in the amount of 
$3,500,000 to the Securities and Exchange Commission for transfer to the general fund of the 
United States Treasury, subject to Exchange Act Section 21F(g)(3).  If timely payment of 
disgorgement and prejudgment interest is not made, additional interest shall accrue pursuant to 
SEC Rule of Practice 600, and if timely payment of a civil money penalty is not made, additional 
interest shall accrue pursuant to 31 U.S.C. §3717.   
 
D. 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 KT 
Corporation 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 Tracy L. Price, FCPA Unit 
Deputy Chief, Division of Enforcement, Securities and Exchange Commission, 100 F St., NE, 
Washington, DC 20549-5631.   
 

 11 
E. 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, 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 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. 
 
F. Respondent acknowledges that the Commission is not imposing a civil penalty in 
excess of $3,500,000 based upon its cooperation in a Commission investigation and related 
enforcement action.  If at any time following the entry of the Order, the Division of Enforcement 
(“Division”) obtains information indicating that Respondent knowingly provided materially false 
or misleading information or materials to the Commission, or in a related proceeding, the Division 
may, at its sole discretion and with prior notice to the Respondent, petition the Commission to 
reopen this matter and seek an order directing that the Respondent pay an additional civil penalty.  
Respondent may contest by way of defense in any resulting administrative proceeding whether it 
knowingly provided materially false or misleading information, but may not:  (1) contest the 
findings in the Order; or (2) assert any defense to liability or remedy, including, but not limited to, 
any statute of limitations defense. 
 
 By the Commission. 
 
 
 
Vanessa A. Countryman 
Secretary 
 
 

UNITED STATES OF AMERICA 

Before the 

SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 94279 / February 17, 2022 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-20780 

 

In the Matter of 

 

KT CORPORATION,  

 

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 KT Corporation (“KT” or “Respondent”).   

 

II. 
 

 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “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 arises out of KT Corporation’s (“KT”) violations of the books and 

records and internal accounting controls provisions of the Foreign Corrupt Practices Act of 1977 

(the “FCPA”) [15 U.S.C. 78dd] in the Republic of Korea and Vietnam.  KT lacked sufficient 

internal accounting controls over expenses, including executive bonuses and purchases of gift 

cards, which enabled managers and executives to generate slush funds.  In addition, the misconduct 

involved former high-level managers and executives and occurred under circumstances whereby 

KT had no relevant anti-corruption policies or procedures with respect to donations, employment 

candidates, vendors, subcontractors, or third-party agents.  In certain instances, this allowed KT 

employees to provide benefits improperly to government officials and to seek business from 

government customers.  As a result of this misconduct, KT violated the books and records and 

internal accounting controls provisions of the FCPA. 

 

RESPONDENT 

 

2. KT Corporation (“KT”) is South Korea’s largest comprehensive 

telecommunications operator, with its principal executive offices in Seoul, South Korea.  KT’s 

American Depositary Shares are registered with the Commission pursuant to Section 12(b) of the 

Exchange Act and trade on the New York Stock Exchange.  KT files periodic reports, including 

Form 20-F, with the Commission pursuant to Section 13(a) of the Exchange Act and related rules 

thereunder. 

 

FACTS 
 

Conduct in Korea 

 

Slush Funds 

 

3. From at least 2009 through 2017, high-level executives of KT maintained slush 

funds, comprised of both off-the-books accounts and physical stashes of cash, in order to provide 

items of value to government officials, among others.  These included gifts, entertainment and, 

ultimately, illegal political contributions to members of the Korean National Assembly serving on 

committees relevant to KT’s business.  

 

4. From 2009 to 2013, a KT then-Executive Officer and another KT senior executive 

orchestrated a scheme through which the Executive Officer approved inflated bonuses to company 

                                                 
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.   
 



 3 

officers and executives, which was then returned to the Executive Officer in cash and used to 

generate a slush fund of approximately $1 million.  Some of the funds were held in a KT 

executive’s personal bank account, while the cash was stored in a safe on the sixteenth floor of 

KT’s offices in Bundang.  The Executive Officer used the cash as a slush fund for gifts to, among 

others, government officials with the ability to influence KT’s business.  No one at KT maintained 

records of the recipients of the gifts, although other KT executives knew about the conduct.  KT 

booked the slush fund amounts as executive bonuses, even though the money was used for gifts 

and for payments to government officials.   

 

5. In October 2013, there were media reports about the bonus scheme, resulting in the 

resignation of the Executive Officer in November 2013 and criminal charges2 in April 2014.  As a 

result, the bonus scheme became impossible to maintain.  Rather than cease the misconduct and 

institute improved internal accounting controls to detect and prevent such schemes in the future, 

KT officials instead devised a new method to continue generating a slush fund.  From 2014 to 

2017,  KT’s Corporate Relations (“CR”) Group purchased gift cards, which were then converted to 

cash and used for a new slush fund.  On numerous occasions, a CR senior manager (“Manager A”) 

told a CR midlevel manager (“Manager B”) how much cash to obtain.  In response, using an 

internal purchasing system, Manager B purchased gift cards from a particular vendor (“Vendor”).  

When buying gift cards to convert to cash, Manager B inserted a tag phrase, “CR Case 

Benchmarking,” in the purchasing system as the purported purpose for the purchase.   

 

6. When the cash was ready, Vendor called Manager B as he arrived outside the KT 

office building where Manager B worked.  Manager B then met Vendor in a van in the parking lot 

next to the KT building.  Vendor gave Manager B a paper bag containing a large manila envelope 

of cash, corresponding to the value of the gift cards purchased, less a commission for Vendor.  

Manager B then gave the cash to Manager A, who placed it in a double-locking cabinet. 

 

7. Over time, Manager A passed the cash to KT officers and managers, with the 

understanding that they would transfer the funds electronically to the  contributions accounts for 

various Korean lawmakers.  Once the transfer was made, a CR employee would inform the 

particular lawmaker’s aide that the contribution came from KT.  This scheme was used  to evade 

Korea’s Political Funds Act, which prohibits corporations from making political contributions.  

Most of the funds went to lawmakers in the National Assembly who sat on committees with the 

ability to impact the telecommunications industry and KT’s business.   

 

8. The individual contributions ranged from KRW 1M ($893) to KRW 14M 

($12,500).  KT ranked the lawmakers (A, B, and C) according to the amounts that the CR Group 

anticipated spending on each one.  CR managers reported the amounts and recipients of the 

contributions to upper management. The political contributions amounted to approximately 

$393,574,and were given to 99 Korean lawmakers and candidates.  The CR Group generated an 

additional $910,211 for improper gift and entertainment expenses, for a combined total for the 

slush fund of $1.3 million.  

 

                                                 
2  After multiple appeals, the Executive Officer was found not guilty of embezzlement from KT, on the 

ground that he used much of the slush fund for the benefit of  KT, rather than for personal use. 



 4 

9. KT booked the gift card expenses used to fund the slush fund as either “research 

and analysis” or “entertainment,” which was inaccurate or did not fairly reflect the transactions.  In 

November 2021, Korean authorities indicted KT and fourteen high-level executives for criminal 

violations in connection with the gift card scheme. 

 

Payments at the Behest of Government Officials  

 

10. Between 2015 and 2016, KT made payments of over $1.6 million to three 

organizations at the request of high-level government officials.  KT paid $972,616 to Foundation 

A, described as a foundation for the promotion of Korean culture, and $603,791 to Foundation B, 

described as a foundation for the promotion of sports.  A close associate of a senior Korean 

government official set up both foundations, and the payments were made at the behest of the Blue 

House, Korea’s presidential residence and office.  The third payment, of $88,420 to another 

organization, Association C concerning e-Sports, was solicited by a member of Korea’s National 

Assembly who served on legislative committees important to KT's business.  All of these payments 

were booked incorrectly, either as charitable donations or as a sponsorship. 

 

11. Despite the circumstances – direct requests for payment coming from or on behalf 

of high government officials – KT took no steps to determine if the payments were legitimate 

donations, rather than illicit payments made at the behest of government officials.  Further, neither 

Foundation A nor B was established when the donation request was made or when KT managers 

agreed to make the payments.   

 

12. In 2015 and 2016, a Blue House official urged, and KT senior management agreed, 

to hire two advertising executives with personal connections to the Blue House and then, once 

hired, transferred them to more desirable positions.  KT also altered its criteria for outside 

advertising agencies in order to hire a new agency established by the same close associate of a high 

Blue House official who had established Foundation A and Foundation B.  The requesting Blue 

House official was clear with KT senior management that “the VIP” – whom KT officials 

understood was the Blue House official’s ultimate boss – “had major concerns about KT’s 

advertisements” and that these moves were “important to the VIP.”  Notwithstanding these 

circumstances, and without conducting due diligence on the individuals or the agency, KT paid the 

two individuals a total of $454,009 in salaries and the advertising firm a total of $5.88 million in 

fees. 

 



 5 

Conduct in Vietnam 

 

13. Between 2014 and 2018, KT employees internally discussed providing money to 

third parties connected to government officials in Vietnam in order to obtain contracts for two 

projects.  The first project was with the People’s Committee of Quang Binh province in Vietnam to 

construct a solar cell power system (“Solar Power Project”), and the second was with the Vietnam 

Ministry of Labor, Invalids and Social Affairs to provide hardware, software, and training for five 

vocational colleges (“Vocational Colleges Project”).  At the time, KT lacked sufficient internal 

accounting controls regarding third parties and no relevant compliance policies regarding due 

diligence.  Moreover, KT took no meaningful steps in response to allegations of improper 

payments in connection with the contracts. 

 

Solar Power Project 

 

14. In 2014, KT entered into an arrangement with a construction company to pay a 

bribe of $95,031 to a high-level official of Vietnam’s Quang Binh province in order to obtain the 

contract for the Solar Power Project.  On September 10, 2014, a junior employee in KT’s Hanoi 

office told an employee of a subcontractor to the construction company, “KT Hanoi will handle the 

matter of deliver[ing] money to the right person.  Only KT Hanoi office now can handle this matter 

because others couldn’t make it.  We will do it in the right way and make it work.  So please 

arrange to transfer the money within today or before next Monday.”  

 

15. The construction company wired money to the employee’s bank account, which the 

employee then withdrew as cash.  The employee and a construction company subcontractor 

representative traveled to the Sun Spa resort in Quang Binh, where the government official 

received the money.  Subsequently, a member of the sales team described the payment as “a rebate 

to the project owner.” 

 

16.  In 2018, the construction company sought reimbursement from KT for the bribe 

payment, described as “expenses for engaging in sales activities with the ordering organization . . .  

($95K),” as well as other expenses.  KT paid the construction company approximately $200,000 to 

settle all the claims, including reimbursement for the bribe payment, and it booked the payment as 

“Support/consulting for performance of the business (completed).” 

 

17. As part of the Solar Power Project, the government customer contracted to pay KT 

an advance payment in January 2015.  As of March 2015, the government customer had not made 

the payment, due to delays in the Ministry of Finance.  A KT senior vice-president (“SVP”) 

instructed a senior employee in the Hanoi office “to give money to the public officials so that they 

can speed up the performance of their duties.”  Using a KT Hanoi office credit card, the senior 

employee conducted four cash-back transactions at a Hanoi restaurant, and he used the cash to pay 

the Ministry officials approximately $3,000.  The effort was successful and resulted in the 

government transmitting the advance payment to KT.   

 



 6 

Vocational Colleges Project 

 

18. In 2013-2014, KT participated with a consortium to bid on the Vocational Colleges 

Project.  The customers were the Vietnam Ministry of Labor, Invalids and Social Affairs 

(“MOLISA”) and the General Department of Vocational Training (“GDVT”).  The Project 

Management Unit (“PMU”) within MOLISA coordinated the project. 

 

19.   A high-level official at GDVT (“Official 1”) introduced KT to a Vietnamese 

company to serve as a local agent.  KT learned ”[t]he possibility of winning the business appears 

higher when using the company designated by [Official 1] as the local agent in the bid.”  In 

addition, KT learned from its original consortium partner (“Partner 1”), which was to pay the agent 

fee, that 10% of the project cost would go to the agent, who would pass on 7% of the project cost 

to Official 1.  Pre-bid, the agent served as a communication channel between KT’s consortium and 

government officials. 

 

20. In May 2015, Partner 1 informed KT that it did not want to be responsible for the 

agent’s fee due to the risk involved.  KT agreed to reorganize the consortium and assume 

responsibility for paying the agent’s fee.  KT and the agent agreed that the fee would be 8.5%, 

which included $550,000 for Official 1, who planned to retire soon and did not want to wait for the 

project to be completed before receiving his share.   

 

21. KT arranged for a subcontractor in the consortium to become a consortium partner, 

as well (“Partner 2”), and KT tasked Partner 2 with the responsibility of paying the agent fee.  The 

purpose of the arrangement was to distance KT from the agent, as well as to conceal the agent from 

KT’s agent review process. While the agent review process was a financial risk review, not an 

anticorruption review, the KT managers involved preferred to avoid any questions about KT’s 

relationship with the agent.  Paying the agent through Partner 2 enabled KT managers to bypass the 

review. 

 

22. On May 19, 2015, Partner 2 sent KT a quotation that included “Site survey and 

Local legal & Technical Consulting.”  Within this item, Partner 2 listed the agent fee of 

approximately $735,000, cloaked as “Site survey for installation.”  The KT sales lead explained to 

the SVP, “As for the fee for the agent, . . . it would not be separately indicated . . . .  Instead. it will 

be included in the estimate for additional tasks based on [Partner 2]' s consent.”  Thus, KT 

managers understood that this fee was for the agent and that it was concealed to avoid review.  On 

May 28, 2015, KT executed the contract for the Vocational Colleges Project.   

 

23. When KT had difficulty with the government customer, it turned to the agent for 

assistance.  For example, on June 6, 2015, the SVP emailed the sales team: 

 

It is ridiculous that [GDVT] approval is going to take 1 week.  Through [the 

agent], make [a PMU official] get the approval in one day.  Do everything 

and anything to have this done.  . . . Immediately push them to prepare the 

required documents for the [GDVT] approval. Also use [the agent] when 

you do this. 



 7 

. . . .  

You need to discuss these matters tomorrow, Sunday. When it is difficult, 

use [the agent] to move [a PMU official]. 

 

At least one interim payment was made to the agent for these services.   

 

24. In January 2017, KT paid Partner 2 approximately $775,000 for undocumented 

“Consulting Service,” which was actually reimbursement for payments Partner 2 had made to the 

agent in order to bribe Official 1. 

 

LEGAL STANDARDS AND VIOLATIONS 
  

25. Under Section 21C(a) of the Exchange Act, 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 rule or 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. 

26. As a result of the conduct described above, KT violated Section 13(b)(2)(A) of the 

Exchange Act, which requires issuers to make and keep books, records, and accounts, which, in 

reasonable detail, accurately and fairly reflect the transactions and disposition of the assets of the 

issuer. [15 U.S.C. § 78m(b)(2)(A)]. 

27. Further, as a result of the conduct described above, KT violated Section 13(b)(2)(B) 

of the Exchange Act, which requires issuers 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.  [15 U.S.C. § 

78m(b)(2)(B)].  

COOPERATION AND REMEDIATION 

 

28. In determining to accept the Offer, the Commission considered those remedial acts 

undertaken by Respondent and the cooperation afforded the Commission staff.  KT did not self-

report the conduct described in this Order, but did cooperate with the Commission’s investigation 

by providing translations or summaries of some relevant documents, providing certain facts 

developed in its own internal investigation, and making certain current and former employees 

available to the Commission staff, including those who needed to travel to the United States. 

29. KT’s ongoing remedial efforts included termination of certain employees 

responsible for the misconduct and introducing enhancements to its internal accounting controls.  

KT strengthened its ethics and compliance organization; enhanced its code of conduct, and policies 



 8 

and procedures regarding expenses; and increased training of employees on anti-bribery issues.  

Nonetheless, KT continues to remediate its process around anticorruption risk-assessments, the 

effectiveness of its audit program, and other internal accounting controls relating to third parties 

and procedures for regular testing of its internal accounting controls. 

DISGORGEMENT AND CIVIL PENALTIES 
 

30. The disgorgement and prejudgment interest ordered in paragraph IV.C. is 

consistent with equitable principles, does not exceed Respondent’s net profits from its 

violations, and returning the money to Respondent would be inconsistent with equitable 

principles. Therefore, in these circumstances, distributing disgorged funds to the U.S. Treasury 

is the most equitable alternative. The disgorgement and prejudgment interest ordered in 

paragraph IV.C. shall be transferred to the general fund of the U.S. Treasury, subject to Section 

21F(g)(3) of the Exchange Act.   

 

UNDERTAKINGS 
 

 Respondent has undertaken to: 

 

1. During a two-year term as set forth below, Respondent shall report to the Commission 

staff periodically, at no less than six-month intervals, the status of its remediation and 

implementation of compliance measures.  During this two-year period, should 

Respondent discover credible evidence, not already reported to the Commission staff, 

that questionable or corrupt payments or questionable or corrupt transfers of value may 

have been offered, promised, paid, or authorized by Respondent, or any entity or person 

acting on behalf of Respondent, or that related false books and records have been 

maintained; or that Respondent’s internal controls failed to detect and prevent such 

conduct, Respondent shall promptly report such conduct to the Commission staff.  

 

2. During this two-year period, Respondent shall (1) conduct an initial review and submit an 

initial report, and (2) conduct and submit at least two follow-up reviews and reports, and 

(3) conduct and submit a Final Report, as described below: 
 

a. Respondent shall submit to the Commission staff a written report within 180 calendar 

days of the entry of this Order setting forth a complete description of its Foreign 

Corrupt Practices Act (“FCPA”) and anti-corruption related remediation efforts to 

date, its proposals reasonably designed to improve the policies and procedures of 

Respondent for ensuring compliance with the FCPA and other applicable 

anticorruption laws, and the parameters of the subsequent reviews (the “Initial 

Report”).  The Initial Report shall be transmitted to Tracy L. Price, Deputy Unit Chief, 

FCPA Unit, Division of Enforcement, United States Securities and Exchange 

Commission, 100 F St. NE, Washington, DC 20549-5631.  Respondent may extend 

the time period for issuance of the Initial Report with prior written approval of the 

Commission staff. 

 



 9 

b. Respondent shall undertake at least two follow-up reviews, incorporating any 

comments provided by the Commission staff on the previous report, to further monitor 

and assess whether the policies and procedures of Respondent are reasonably designed 

to detect and prevent violations of the FCPA and other applicable anti-corruption laws 

(the Follow-up Reports).  The first Follow-up Report shall be submitted by no later 

than 180 days after the Initial Report. The second Follow-up Report shall be submitted 

by no later than 360 days after the submission of the Initial Report.   
 

c. Respondent shall undertake a final review to further monitor and assess the operation 

of its FCPA and anti-corruption compliance program and whether Respondent’s 

policies and procedures are reasonably designed to detect and prevent violations of the 

FCPA and other applicable anti-corruption laws (the “Final Report”).  The Final 

Report shall be submitted by no later than 540 days after the submission of the Initial 

Report. Respondent may extend the time period for issuance of the Follow-up Reports 

with prior written approval of the Commission staff. 
 

3. The periodic reviews and reports submitted by Respondent will likely include 

confidential financial, proprietary, competitive business or commercial information. 

Public disclosure of the reports could discourage cooperation, impede pending or 

potential government investigations or undermine the objectives of the reporting 

requirement.  For these reasons, among others, the reports and the contents thereof are 

intended to remain and shall remain non-public, except (1) pursuant to court order, (2) as 

agreed to by the parties in writing, (3) to the extent that the Commission determines in its 

sole discretion that disclosure would be in furtherance of the Commission’s discharge of 

its duties and responsibilities, or (4) is otherwise required by law. 

 

4. Certify, in writing, compliance with the undertaking(s) set forth above.  The certification 

shall identify the undertaking(s), provide written evidence of compliance in the form of a 

narrative, and be supported by exhibits sufficient to demonstrate compliance.  The 

Commission staff may make reasonable requests for further evidence of compliance, and 

Respondent agrees to provide such evidence.  The certification and supporting material 

shall be submitted to Tracy L. Price, Deputy Unit Chief, FCPA Unit, with a copy to the 

Office of Chief Counsel of the Enforcement Division, no later than sixty (60) days from the 

date of the completion of the undertakings. 

 



 10 

IV. 

 

 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 

agreed to in Respondent KT’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 

13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act. 

 

 B. Respondent shall comply with the undertakings enumerated in Section III above. 

 

C. Respondent shall, within 30 days of the entry of this Order, pay disgorgement of 

$2,263,821, prejudgment interest of $536,457, and a civil money penalty in the amount of 

$3,500,000 to the Securities and Exchange Commission for transfer to the general fund of the 

United States Treasury, subject to Exchange Act Section 21F(g)(3).  If timely payment of 

disgorgement and prejudgment interest is not made, additional interest shall accrue pursuant to 

SEC Rule of Practice 600, and if timely payment of a civil money penalty is not made, additional 

interest shall accrue pursuant to 31 U.S.C. §3717.   

 

D. 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 KT 

Corporation 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 Tracy L. Price, FCPA Unit 

Deputy Chief, Division of Enforcement, Securities and Exchange Commission, 100 F St., NE, 

Washington, DC 20549-5631.   

 

http://www.sec.gov/about/offices/ofm.htm


 11 

E. 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, 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 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. 

 

F. Respondent acknowledges that the Commission is not imposing a civil penalty in 

excess of $3,500,000 based upon its cooperation in a Commission investigation and related 

enforcement action.  If at any time following the entry of the Order, the Division of Enforcement 

(“Division”) obtains information indicating that Respondent knowingly provided materially false 

or misleading information or materials to the Commission, or in a related proceeding, the Division 

may, at its sole discretion and with prior notice to the Respondent, petition the Commission to 

reopen this matter and seek an order directing that the Respondent pay an additional civil penalty.  

Respondent may contest by way of defense in any resulting administrative proceeding whether it 

knowingly provided materially false or misleading information, but may not:  (1) contest the 

findings in the Order; or (2) assert any defense to liability or remedy, including, but not limited to, 

any statute of limitations defense. 

 

 By the Commission. 

 

 

 

Vanessa A. Countryman 

Secretary 

 

 


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