NEW YORK (TheStreet) -- Shares of Och-Ziff Capital Management Group (OZM) were down sharply today on the heels of news that the company is under investigation by the U.S. Department of Justice and had received subpoenas from the Securities and Exchange Commission for its dealings with Libya's sovereign wealth fund in 2007, according to published media reports. The firm has been under investigation since 2011.
Och-Ziff revealed the investigation in a 10-K filing released yesterday, although the filing made no specific reference to Libya. According to the filing Och-Ziff is under investigation for potential breaches of the Foreign Corrupt Practices Act which prohibits the bribing of foreign officials.
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From the filing: "Beginning in 2011, and from time to time thereafter, we have received subpoenas from the SEC and requests for information from the U.S. Department of Justice (the "DOJ") in connection with an investigation involving the FCPA and related laws. The investigation concerns an investment by a foreign sovereign wealth fund in some of our funds in 2007 and investments by some of our funds, both directly and indirectly, in a number of companies in Africa. At this time, we are unable to determine how the investigation will be resolved and what impact, if any, it will have. An adverse outcome could have a material effect on our business, financial condition or results of operations."
The investigation has hurt shares today with Och-Ziff shares down as much as 5.2% on Wednesday.
State owned investment firms like the Libyan Investment Authority are considered foreign officials by the U.S. government