Uber has just selected a new chairman, but the flood of bad news facing the Silicon Valley transport company does not stop.
The company confirmed on Tuesday that the Department of Justice is investigating whether executives violate the US laws prohibiting the bribery of foreign officials.
About cooperating with the investigation, said a spokesman Matt Kallman. The message was first reported by the Wall Street Journal. The DOJ did not respond immediately to requests for comment.
The federal bribery investigation is striking in one respect: large multinational corporations such as Walmart and Halliburton are more frequently subject to bribery investigations. Silicon Valley startups rarely do this kind of review.
The probe can reflect an aggressive international strategy pursued by the company’s trusted CEO, Travis Kalanick. Under the heavy-charging Kalanick, the Uber has expanded to 77 countries in only eight years.
The case is also the latest in a long litany of Tradems faced the company’s alleged incoming CEO, Expedia CEO Dara Khosrowshahi.
Khosrowshahi must struggle with the reputation of the company for rule-breaking and for a “bro” culture that is hostile to women and underrepresented minorities. He will address two federal investigations – the bribery investigation and a probe launched in May, whether the company has used special software to evade authorities in places where ride-sharing services were banned or restricted.
He must work to regain the confidence of the drivers after the company had admitted that she had been paying her for nearly three years in New York.
And he must continue to make a major lawsuit against Waymo, the self-employed division of Google, about whether the company has stolen business secrets to build its self-running car program.
The bribery probe is provisional, according to the Wall Street Journal. Depending on what it finds, the agency could open a larger investigation.
International expansion strategies, which were implemented by land managers and also by Kalanick himself, often led to controversy. The company recently pulled out of China and Russia in face of the brutal competition from local champions, which were favorably viewed by the government. The company was broken into South Korea and France, and was recently suspended in the Philippines. It also struggles with European regulatory authorities to decide whether it should be subject to the same rules as regular taxi services.
US rules that prevent foreign bribery from a Watergate era law, known as the US Foreign Corrupt Practice Act, which is not only the payment of bribes to foreign officials, but also the intention to bribe or fuzzy accounting practices prohibits.
Payments may include receiving or providing cash or non-cash gifts of value to a foreign official.
It was not known which country or countries were involved in the probe.