Cognizant Drops on Payments Investigation

From Bloomberg:

Cognizant Technology Solutions Corp. tumbled in early trading after revealing an internal investigation into whether some payments in India violated the U.S. Foreign Corrupt Practices Act.

The investigation is currently focused on a small number of company-owned facilities and is being conducted under oversight by the board’s audit committee, with assistance from outside counsel, according to a filing Friday. The information technology services company has voluntarily notified the U.S. Department of Justice and the U.S. Securities and Exchange Commission and is working with the agencies.

“The company is not able to predict what, if any, action may be taken by the DOJ, SEC, or any governmental authority in connection with the investigation or the effect of the matter on the company’s results of operations, cash flows or financial position,” Cognizant wrote in the filing.

Note that the Cognizant investigation began internally and then they notified the SEC. The shares are down about 12% today.

Posted by on September 30th, 2016 at 9:51 am

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