FLIR punished for ‘world tour’

The Wilsonville-based military contractor gave Saudi officials a trip that amounted to a bribe.

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The US government and Wilsonville-based Flir Systems, Inc. agreed to a $9.5 million settlement over a trip for Saudi officials.

The $40,000 “world tour” was essentially a bribe, the case alleges.


The U.S. Securities and Exchange Commission said Wednesday the company violated the Foreign Corrupt Practices Act when it paid for the travel. The SEC claims FLIR earned more than $7 million in profits from Saudi purchases of FLIR hardware influenced by improper travel and gifts.

Two FLIR employees in its Dubai office provided expensive watches to government officials with the Saudi Arabia Ministry of Interior in 2009. They also arranged for the company to pay for a 20-night excursion by Saudi officials that included stops in Casablanca, Paris, Dubai, Beirut, and New York City. It was all courtesy of two company salesmen, Stephen Timms and Yasser Ramahi. It was payback, the agency claims, after the Saudi government agreed to buy $12.9 million worth of FLIR’s thermo-imaging binoculars.

In a written statement, the chief of the SEC Enforcement Division FCPA unit, Kara Brockmeyer, said, “FLIR’s deficient financial controls failed to identify and stop the activities of employees who served as de facto travel agents for influential foreign officials to travel around the world on the company’s dime.”

FLIR self-reported the indiscretions, Portland Business Journal reports.

According to the SEC, “the value of the gifts and the extent and nature of the travel were falsely recorded in FLIR’s books and records as legitimate business expenses, and the company’s internal controls failed to catch the improper payments …”

Following the settlement, FLIR must report compliance efforts to the SEC for the next two years. The company reserved money for the settlement in the fourth quarter of 2014.

FLIR President and CEO, Andy Teich in a written statement:

“FLIR takes compliance very seriously and has policies and procedures in place to prevent such conduct.”

“We self-reported the employees’ activities to the relevant authorities upon discovering them and cooperated with the government’s investigation. We have taken action to bolster our training, controls, and policies.”

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