Digi International (DGII) Scandal: CFO Resigns Amid Investigation

I missed the news last Friday that the CFO of Digi International (DGII) had resigned amid a corporate investigation.  More details are emerging.  The investigation centers around a possible violation of its entertainment and travel policies overseas with a few employees.  Jet setting and strip clubs? 

Seems more serious.  The company has notified the US Dept of Justice and the SEC about the probe which may include a violation of the Foreign Corrupt Practices Act which aims to punish bribery.  As this article points out, Daimler paid more than $180 million in fines and penalties last month to settle a case in which it was accused of bribing local officials to score contracts.  That may be the case with Digi. We shall see.

Shares of DGII have tumbled in recent days about 15%, but held support of the 200 day moving average today.  This is still an emerging growth company, but I typically stay away from companies with legal issues. 

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