The Securities and Exchange Commission announced that BIT Mining Ltd., formerly known as 500.com Limited, agreed to pay a $4 million civil penalty to settle charges that it violated the Foreign Corrupt Practices Act (FCPA) from 2017 to 2019 by engaging in a widespread bribery scheme to influence numerous foreign officials, including members of Japan’s parliament, in efforts to establish an integrated resort casino in Japan. 500.com was an online sports lottery service provider headquartered in Shenzhen, China, whose shares traded on the New York Stock Exchange under the symbol “WBAI.” It also agreed to pay another $6 million relating to a parallel action in which the U.S. Department of Justice entered into a deferred prosecution agreement in which BIT Mining agreed to pay a $10 million criminal fine, of which $4 million will be satisfied by the company’s payment of a civil penalty pursuant to the SEC’s order.
The SEC’s order finds that the bribery scheme involved illicit payments of approximately $2.5 million in the form of cash bribes, entertainment, and extravagant trips. The order further finds that the bribes were authorized by a 500.com senior executive and that, after the bribery scheme came to light, the company never entered the market. Here is a copy of the SEC ORDER: https://www.sec.gov/files/litigation/admin/2024/34-101649.pdf
“Investors must have confidence that the operations and performance of public companies reflect merit and legitimate considerations. Bribery and corruption turn that dynamic on its head, distorting the orderly operation of the markets and undermining investor confidence,” said Charles E. Cain, Chief of the SEC Enforcement Division’s FCPA Unit. “Here, 500.com’s deficient controls fostered an environment that enabled a bribery scheme involving the highest level of the company and influential Japanese officials. This case underscores the need for robust internal accounting controls that are properly implemented and effective throughout an organization.”
BIT Mining consented to the SEC’s order finding that it violated the anti-bribery, recordkeeping, and internal accounting controls provisions of the FCPA. BIT Mining has agreed to cease and desist from committing or causing any violations and any future violations of these provisions and to pay the civil penalty mentioned above.
In a parallel action, the U.S. Department of Justice announced today it has entered into a deferred prosecution agreement in which BIT Mining agreed to pay a $10 million criminal fine, of which $4 million will be satisfied by the company’s payment of a civil penalty pursuant to the SEC’s order.
The SEC’s investigation was conducted by Denise Hansberry and Maria F. Boodoo and supervised by Tracy L. Price of the SEC’s FCPA Unit.
Jeff Newman JD MBA, represents whistleblowers nationwide relating to Medicare and Medicaid fraud, under the state and federal False Claims Act (Qui Tam) and corporate whistleblowers in major claims under the SEC, CFTC and FINCEN whistleblower programs. He can be reached at Jeff@JeffNewmanLaw.com or at 617-823-3217
