Related FCPA Matter: Panasonic Corporation's Involvement in Multiple Countries
Initiation Date: 12/18/2018
Prosecuting Agency: U.S. Securities and Exchange Commission
Type of Action: SEC Administrative Proceeding
Docket or Case Number: 3-18939
Foreign Enforcement Action/Investigation: Unknown
Origin of the Proceeding: Unknown
Whistleblower: Unknown
Case Status: Resolved
Summary
Panasonic Corporation, headquartered in Osaka, Japan, was a multinational corporation organized into eight business segments, one of which included Panasonic Avionics Corporation ("PAC"), which was a wholly owned subsidiary based in the U.S. that designed, engineered, manufactured, sold, and installed in-flight entertainment systems and global communications services to airlines, aircraft leasing services, and airplane manufacturers worldwide. PAC’s books and records and financial accounts were consolidated into Panasonic’s books and records and reported on Panasonic’s consolidated financial statements. Panasonic’s shares were registered with the SEC until April 22, 2013, and traded on the New York Stock Exchange. Additionally, from May 1, 2015 through June 20, 2016, Panasonic’s securities were registered with the SEC.
Takeshi “Tyrone” Uonaga was PAC’s Chief Financial Officer from June 2012 through April 2016. Uonaga had been employed in Panasonic finance since graduating from a Japanese University in 1986, including holding CFO positions in Panasonic’s U.K. and Germany subsidiaries. Panasonic terminated Uonaga in February 2018.
According to the documents in this case, in July 2012, PAC improperly recognized approximately $82 million in revenue from a contract with one of its largest customers, a state-owned airline, by backdating the contract to indicate that it had been signed prior to the quarter ending June 30, 2012. Uonaga then provided a false certification and management representation letter to PAC’s external auditor stating that PAC’s financial statements for the quarter had been prepared in conformity with prevailing audit standards and that there were no deficiencies concerning PAC’s internal accounting controls and books and records.
In a settled administrative proceeding initiated on December 18, 2018, the SEC ordered Uonaga to cease and desist violations of the books and records and internal controls provisions of the FCPA as well as violations of the rules governing a company's public reports and about lying to its auditors. Under the terms of the settlement, the SEC required Uonaga to pay a civil fine of $50,000 and denied him the privilege to appear before the SEC as an accountant for at least five years, at which time he could request reinstatement by application.
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