Federal regulators investigating Microsoft over foreign bribery claims

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Microsoft Foreign Bribery Investigation

Microsoft CEO Steve Ballmer

Microsoft (MSFT) may soon find itself in some significant legal trouble now that federal officials are investigating whether the company allegedly worked with firms that bribed foreign government officials into accepting Microsoft software contracts. Unnamed sources have told The Wall Street Journal that “lawyers from the Justice Department and the Securities and Exchange Commission are examining kickback allegations made by a former Microsoft representative in China, as well as the company’s relationship with certain resellers and consultants in Romania and Italy.” The Journal’s sources say that the investigation is still in a “preliminary” phase and that the government has yet to accuse the company or its overseas partners of any wrongdoing. The Journal also writes that the investigation is “one of dozens being conducted under the Foreign Corrupt Practices Act, a 1977 law that prohibits U.S. companies and companies that trade on U.S. stock exchanges from paying bribes to foreign officials.”

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