Just In: 3M China Subsidiary Pays $6.5M SEC Settlement

Kelvin Munene Murithi
August 25, 2023 Updated May 16, 2025
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In a recent report, 3M Company has agreed to pay over $6.5 million in fines in a settlement with the SEC following claims of breaking the Foreign Corrupt Practices Act (FCPA). The alleged illegal actions of a 3M subsidiary in China were central to these claims.

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Tourism Lures: A Tactic to Boost Sales

According to the Securities and Exchange Commission (SEC), 3 M’s Chinese arm had a peculiar method to bolster sales. The subsidiary provided overseas travel opportunities to Chinese government officials. 

Significantly, these weren’t just any trips but also encompassed guided tours, leisurely shopping visits, and sightseeing at local attractions. Moreover, these luxury trips were often veiled under the guise of attending international conferences or educational events.

However, the nature of these trips raises eyebrows since many tourism activities were scheduled concurrently with the so-called ‘official’ events. Consequently, these government officials, intended attendees of these events, either missed them entirely or only partially participated. 

Additionally, some events in English needed more appropriate translation services, leaving some attendees in the dark. These omissions and the luxurious itinerary designs point fingers at these trips being more about pleasure than business.

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3 M’s Measures and SEC’s Verdict

After discovering discrepancies in 2018, 3M reported to the U.S. authorities and cooperated wholeheartedly during the investigation. Besides rectifying the ethical lapse by taking action against the involved parties, the company has upgraded its internal controls to prevent future recurrences.

In response to the findings, the Chief of the SEC’s FCPA Unit, Charles Cain, stated, “This matter highlights the dangers to companies with global operations posed by inadequate internal accounting controls.” Indeed, robust checks and balances are paramount in the era of globalization.

Hence, while 3M has neither confirmed nor denied the SEC’s findings, they’ve agreed to the financial settlement. This settlement includes the return of ill-gotten gains and a civil penalty. Additionally, the company promises to abstain from future violations.

While the monetary settlement is significant, the broader implication for multinationals is the vital need for rigorous internal checks and ethical operations worldwide.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Kelvin Munene is a crypto and finance journalist with over 5 years of experience, offering in-depth market analysis and expert commentary . With a Bachelor's degree in Journalism and Actuarial Science from Mount Kenya University, Kelvin is known for his meticulous research and strong writing skills, particularly in cryptocurrency, blockchain, and financial markets. His work has been featured across top industry publications such as Coingape, Cryptobasic, MetaNews, Cryptotimes, Coinedition, TheCoinrepublic, Cryptotale, and Analytics Insight among others, where he consistently provides timely updates and insightful content. Kelvin’s focus lies in uncovering emerging trends in the crypto space, delivering factual and data-driven analyses that help readers make informed decisions. His expertise extends across market cycles, technological innovations, and regulatory shifts that shape the crypto landscape. Beyond his professional achievements, Kelvin has a passion for chess, traveling, and exploring new adventures.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.