Archive

December 2, 2022

Global technology company ABB Ltd. will pay over $315 million for violating the Foreign Corrupt Practices Act. Between 2014 and 2017, ABB paid bribes to Eskom Holdings Limited, a South African state-owned and controlled energy company. The bribes were paid to subcontractors associated with a South African government official and were used to obtain business advantages in the awarding of contracts. ABB conducted sham negotiations on pre-arranged pricing, and falsely recorded payments—portions of which were meant as bribes—to subcontractors as legitimate business expenses. DOJ; SEC

September 27, 2022

Oracle Corporation has been ordered to pay more than $23 million to resolve charges that its subsidiaries in Turkey, the UAE, and India violated the Foreign Corrupt Practices Act.  According to the SEC, between 2016 and 2019, the subsidiaries used slush funds to pay foreign officials and their families to attend international technology conferences in exchange for business.  Oracle India was previously sanctioned for similar charges in 2012.  SEC

September 15, 2022

Brazil’s second largest airline, GOL Linhas Aéreas Inteligentes S.A. (GOL), has agreed to pay $70 million to the SEC and $41 million to civil and criminal authorities in the U.S. and Brazil to resolve charges of violating the Foreign Corrupt Practices Act.  The airline allegedly offered and paid $3.8 million in bribes to various officials in Brazil to help usher in legislation involving certain payroll taxes and fuel tax reductions that were favorable to the airline.  DOJ; SEC

June 2, 2022

Luxembourg-based steel pipe manufacturer Tenaris will pay more than $78 million to resolve claims that between 2008 and 2013 its Brazilian subsidiary paid bribes to obtain and retain business from the Brazil state-owned entity Petrobras.  The SEC alleged that Tenaris violated the anti-bribery, books and records, and internal accounting controls provisions of the Foreign Corrupt Practices Act.  SEC

May 24, 2022

Switzerland-based mining and commodity trading firm Glencore International A.G. and an affiliate have agreed to pay over $1.1 billion in criminal penalties and forfeitures, and will plead guilty to violations of the Foreign Corrupt Practices Act and conspiracy to engage in commodity price manipulation.  In addition, the companies will pay over $1.186 billion in civil penalties and disgorgement in settlement with the CFTC.  As part of the criminal plea agreement, Glencore admitted that between 2007 and 2018, it corruptly provided more than $100 million in payments and other things of value to intermediaries for the payment of bribes to officials in Nigeria, Cameroon, Ivory Coast, Equatorial Guinea, Brazil, Venezuela, and the Democratic Republic of the Congo.  With respect to the commodity price manipulation scheme, the CFTC found that from as early as 2007 through at least 2018, Glencore sought to increase profits from its physical and derivatives oil products trading by manipulating or attempting to manipulate four U.S. based S&P Global Platts physical oil benchmarks and related futures and swaps.  Criminal fines and forfeitures total over $700 million for the FCPA violations and nearly $486 million for the for the market manipulation violations, which amounts are subject to credits for amounts paid to the CFTC and foreign authorities including the United Kingdom.  The $1.186 billion CFTC resolution will also be reduced, with Glencore receiving credit for payments in the criminal resolutions.  DOJ; USAO SDNY; CFTC

April 20, 2022

Waste management company Stericycle Inc. agreed to pay a total of $84 million and enter into a deferred prosecution agreement admitting to the payment of millions of dollars in bribes to government officials in Brazil, Mexico, and Argentina in order to obtain and retain business and to secure improper advantages in violation of the Foreign Corrupt Practices Act.  The company’s foreign subsidiaries maintained false records to conceal the bribes, which were typically paid in cash and recorded on spreadsheets using code words and euphemisms, including describing the payments made in Argentina as “alfajores.”  Stericycle’s total payment consists of a $28 million payment to resolve an investigation by the SEC, a $52.5 million criminal penalty, and $9.3 million to resolve investigations by the Controladoria-Geral da União (CGU) and the Advocacia-Geral de União (Attorney General’s Office) in Brazil, part of which will be credited to reduce the criminal penalty.  DOJ; SEC

February 17, 2022

South Korean telecommunications company KT Corporation will pay $6.3 million to resolve charges that the company and its executives engaged in multiple improper payment schemes in Korea and Vietnam in violation of the Foreign Corrupt Practices Act. The company allegedly failed to have adequate accounting controls, resulting in the creation of slush funds used for gifts and illegal political contributions to government officials who had influence over KT Corp.’s business.  SEC

October 19, 2021

Credit Suisse Group AG, together with related subsidiaries, and VTB Capital plc will collectively pay more than $481 million to resolve charges related to the financing of hundreds of millions in loans to the government of Mozambique and an entity owned by that government, Empresa Moçambicana de Atum S.A. (EMATUM), which was formed to develop a tuna fishing project.  Credit Suisse, which pleaded guilty to defrauding investors and entered into a settlement agreement with the SEC, will pay nearly $475 million to U.S. and international authorities, as well as restitution to individual investors.  As part of its guilty plea, Credit Suisse admitted that it made material misrepresentations and omissions in statement to investors including about the planned use of loan proceeds; about $50 million in kickback payments to a Credit Suisse subsidiary and $150 million in bribes to government officials; about the existence and maturity dates of other loans to the government of Mozambique; about other red flags prior to and during the EMATUM financing; and about the risk of default.  In addition, the SEC charged that Credit Suisse violated the internal accounting controls and books and records provisions of the Foreign Corrupt Practices Act. Credit Suisse's payment consists of a $99 million payment to the SEC ($65 million as a penalty and $34 million in disgorgement and interest), a $247.52 million criminal monetary penalty to the U.S., with $175.6 million to be paid and the remaining to $47.2 million to be credited to related settlements, and $200.7 million to the United Kingdom's Financial Conduct Authority.  In addition, Credit Suisse agreed to provide $200 million as debt relief to Mozambique. VTB will pay $6.4 million to resolve SEC charges that it mislead investors in a related bond offering structured by VTB Capital and Credit Suisse, which the SEC found failed to disclose the true nature of Mozambique's debt and the high risk of default on the bonds.  SEC; DOJ

September 24, 2021

London-based advertising company WPP plc, which has ADRs registered in the US, will pay $19 million in disgorgement, interest, and penalties to resolve allegations that it violated the Foreign Corrupt Practices Act.  The SEC charged that WPP acquired advertising agencies in high-risk markets and failed to insure that these subsidiaries implemented appropriate internal controls or respond to repeated warning signs and internal complaints about activities including payments to government officials in India, China, Brazil, and Peru.  SEC