14 DAY TRIAL // United States authorities are investigating a General Services Administration (GSA) Schedule contract IT security solutions provider Symantec has made with the government. In a filing submitted to the US Security and Exchange Commission (SEC), the company said it could lose around $145 million (€107 million) due to the investigation.
The government is analyzing Symantec’s compliance with a contract from January 24, 2007. The company’s total sales under this particular contract up until December 2011 were of $210 million (€155 million).
The investigation provisions are related to pricing, country of origin, disclosure of commercial sales practices, and accessibility.
“We are fully cooperating with the investigation and in January 2014 met with representatives of the government who presented us with an initial analysis of our actual damages exposure in the amount of approximately $145 million. We are currently in the process of evaluating the government’s initial analysis,” the report to the SEC reads.
“It is possible that the investigation could lead to claims or findings of violations of the False Claims Act, and could be material to our results of operations and cash flows for any period,” it continues.
“Resolution of False Claims Act investigations can ultimately result in the payment of somewhere between one and three times the actual damages proven by the government, plus civil penalties in some cases, depending upon a number of factors.”
Symantec has learned that it’s being investigated in the first fiscal quarter of 2013 after being notified by the Commercial Litigation Branch of the Department of Justice’s Civil Division and the Civil Division of the District of Columbia US Attorney’s Office.
In the SEC filing, the company has admitted being involved in other administrative and judicial proceedings. However, Symantec says they shouldn’t have an impact on business, financial condition or cash flow.