FCPA

October 14, 2020

Brazilian investment company J&F Investimentos S.A. and is meat producer subsidiary, JBS S.A., along with their principles Joesley Batista and Wesley Batista have entered into a settlement agreement with the SEC and DOJ, agreeing to pay nearly $283 million in fines and disgorgement and plead guilty to resolve charges under the FCPA arising from a scheme to bribe government officials in Brazil in order to obtain financing and other benefits for the companies.  Defendants paid approximately $180 million in bribes to obtain hundreds of millions of dollars in financing from Brazilian state-owned and state-controlled banks BNDES and Caixa, as well as to facilitate JBS’s acquisition of U.S. company Pilgrim’s Pride Corporation.  The bribes were allegedly paid from U.S. assets, including JBS operating accounts that also contained Pilgrim’s funds.  The SEC further charged that the Batistas, who exerted significant control over Pilgrim’s, caused it have an inadequate system of internal controls and accurate books and records.  The criminal fine of $256 million will be discounted up to 50% to credit defendants for a settlement with Brazilian authorities valued at $1.9 billion; the SEC agreement provides for a payment of $27 million in disgorgement and interest. Defendants also agreed to cooperate any ongoing or further investigations and implement an enhanced compliance program. DOJ; SEC; USAO EDNY

September 22, 2020

Florida-based asphalt company Sargeant Marine, Inc., will plead guilty and pay $16.6 million to resolve claims that it violated the Foreign Corrupt Practices Act.  Between 2010 and 2018 the company paid millions of dollars in bribes to foreign officials in Brazil, Venezuela, and Ecuador, in order to secure contracts with state-owned oil companies.  To execute the scheme and conceal the bribe payments, Sargeant Marine entered into fake consulting agreements with bribe intermediaries.  DOJ; USAO ED NY

August 28, 2020

Herbalife Nutrition Ltd. will pay over $123 million to resolve claims that the US-based company violated the Foreign Corrupt Practices Act by paying bribes to Chinese officials and other state-owned entities in order to secure required direct selling licenses, improperly influence Chinese investigations into Herbalife's business, and improperly influence Chinese state-owned and state-controlled media for the purpose of removing negative media reports about Herbalife. Herbalife admitted that over the course of ten years it falsified its books and records in order to provide corrupt payments and benefits to Chinese government officials.  To resolve criminal charges, Herbalife will enter into a deferred prosecution agreement and pay a $55 million criminal penalty; to resolve civil charges by the SEC, Herbalife will pay disgorgement and interest totaling approximately $67 million.  DOJ; USAO SDNY; SEC

August 6, 2020

South Carolina-based consumer loan company World Acceptance Corporation has been ordered to pay $21 million to resolve allegations of violating the Foreign Corrupt Practices Act (FCPA).  According to the SEC, the company’s former Mexican subsidiary, WAC de Mexico S.A. de C.V., paid more than $4 million in bribes to Mexican officials from 2010 to 2017 in order to secure the ability to make loans to government employees, then recorded the payments as legitimate business expenses.  SEC

July 2, 2020

Alexion Pharmaceuticals, Inc. will pay $21 million to resolve SEC charges that it violated the Foreign Corrupt Practices Act.  Alexion subsidiaries in Turkey and Russia were alleged to have made payments to foreign officials in those countries in order to secure favorable regulatory treatment for Alexion’s drug Soliris, and to increase the number of prescriptions for the drug.  The Turkish and Russian subsidiaries, as well as Alexion subsidiaries in Brazil and Colombia, falsified their books and records with respect to improper payments, and Alexion’s internal accounting controls were not adequate to detect or prevent the improper payments and accounting.  SEC

June 25, 2020

Novartis AG, a Switzerland-based pharmaceutical company, along with its Greek subsidiary, Novartis Hellas S.A.C.I. (Novartis Greece), have agreed to pay $233 million to the DOJ and $112 to the SEC, for a combined penalty of $345 million, in order to resolve charges of violating the Foreign Corrupt Practices Act.  A former subsidiary, Alcon Pte Ltd—now a subsidiary of multinational eyecare company, Alcon Ltd—has agreed to pay $8.9 million to resolve similar charges.  Between 2012 and 2016, the subsidiaries allegedly bribed employees of state-owned hospitals and clinics in Greece and Vietnam to use Novartis or Alcon-branded products while falsely recording the improper payments.  As part of the settlement, both Novartis Greece and Alcon Pte Ltd will also enter into deferred prosecution agreements with DOJ.  DOJ; USAO NJ; SEC