Difference between revisions of "Foreign bribery and FCPA violations"

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* On November 29, 2017, SMB Offshore, a company specializing in manufacture and design of offshore oil drilling equipment, agreed to pay [https://www.justice.gov/opa/pr/sbm-offshore-nv-and-united-states-based-subsidiary-resolve-foreign-corrupt-practices-act-case $238 million] to resolve charges that the company bribed foreign officials in Brazil, Angola, Equatorial Guinea, Kazakhstan and Iraq for government contracts. According to the DOJ, the company paid more than $180 million to middlemen while knowing that the money would go towards bribing officials. The scheme involved some of the highest-level executives within the company and lasted for more than a decade (1996-2012). The company entered into a [https://dlbjbjzgnk95t.cloudfront.net/0989000/989737/deferred%20pros%20agreement%2017-686.pdf deferred prosecution agreement].  
* On November 29, 2017, SMB Offshore, a company specializing in manufacture and design of offshore oil drilling equipment, agreed to pay [https://www.justice.gov/opa/pr/sbm-offshore-nv-and-united-states-based-subsidiary-resolve-foreign-corrupt-practices-act-case $238 million] to resolve charges that the company bribed foreign officials in Brazil, Angola, Equatorial Guinea, Kazakhstan and Iraq for government contracts. According to the DOJ, the company paid more than $180 million to middlemen while knowing that the money would go towards bribing officials. The scheme involved some of the highest-level executives within the company and lasted for more than a decade (1996-2012). The company entered into a [https://dlbjbjzgnk95t.cloudfront.net/0989000/989737/deferred%20pros%20agreement%2017-686.pdf deferred prosecution agreement].  
* On December 22, 2017, Keppel Offshore & Marine Ltd. (KOM) and its U.S. subsidiary agreed to pay approximately [https://www.justice.gov/opa/pr/keppel-offshore-marine-ltd-and-us-based-subsidiary-agree-pay-422-million-global-penalties $422 million] to resolve charges that it violated the FCPA by paying millions to public officials in Brazil to win contracts with the Brazilian state-owned oil company Petrobras.  According to the [https://dlbjbjzgnk95t.cloudfront.net/0997000/997760/kom_information_-_0.pdf information] filed in the Eastern District of New York, the bribery scheme yielded $350 million in profits. KOM used agreements with consulting companies to facilitate the bribe payments to obtain business from Petrobras and conceal the bribes.  KOM is paying approximately to U.S. regulators and the remaining amount to enforcement authorities in Singapore and Brazil.
* On December 22, 2017, Keppel Offshore & Marine Ltd. (KOM) and its U.S. subsidiary agreed to pay approximately [https://www.justice.gov/opa/pr/keppel-offshore-marine-ltd-and-us-based-subsidiary-agree-pay-422-million-global-penalties $422 million] to resolve charges that it violated the FCPA by paying millions to public officials in Brazil to win contracts with the Brazilian state-owned oil company Petrobras.  According to the [https://dlbjbjzgnk95t.cloudfront.net/0997000/997760/kom_information_-_0.pdf information] filed in the Eastern District of New York, the bribery scheme yielded $350 million in profits. KOM used agreements with consulting companies to facilitate the bribe payments to obtain business from Petrobras and conceal the bribes.  KOM is paying approximately to U.S. regulators and the remaining amount to enforcement authorities in Singapore and Brazil.
* On April 30, 2018, Panasonic agreed to pay [https://www.sec.gov/news/press-release/2018-73 $143 million] to resolve charges of FPCA and accounting fraud violations involving its global avionics business. According to the SEC’s order, Panasonic offered a lucrative consulting position to a government official at a state-owned airline to induce the official to help Panasonic in obtaining and retaining $700 million in business from the airline. In addition, the SEC found that Panasonic fraudulently overstated net income by more than $82 million for the fiscal year ending June 30, 2012, by prematurely recognizing revenue on an agreement. Panasonic accomplished the fraud by backdating the agreement and providing misleading information to its external auditor.
* On April 30, 2018, Panasonic agreed to pay [https://www.sec.gov/news/press-release/2018-73 $143 million] to resolve charges of FPCA and accounting fraud violations involving its global avionics business. According to the SEC’s [https://www.sec.gov/litigation/admin/2018/34-83128.pdf order], Panasonic offered a lucrative consulting position to a government official at a state-owned airline to induce the official to help Panasonic in obtaining and retaining $700 million in business from the airline. In addition, the SEC found that Panasonic fraudulently overstated net income by more than $82 million for the fiscal year ending June 30, 2012, by prematurely recognizing revenue on an agreement. Panasonic accomplished the fraud by backdating the agreement and providing misleading information to its external auditor.
* On July 5, 2018, the SEC announced that Credit Suisse Group AG agreed to pay $30 million to the SEC and $47 million to the DOJ to resolve charges that it violated the anti-bribery and internal accounting provisions of the FCPA. According to the SEC’s order, between at least 2007 and 2013, Credit Suisse provided valuable employment to the relatives and friends of certain foreign government officials as a personal benefit to the requesting officials in order to obtain or retain investment banking business or other benefits for the bank. This quid pro quo arrangement resulted in multiple deals and substantial profits for Credit Suisse. Specifically, the SEC found that in a six-year period, Credit Suisse offered to hire more than 100 individuals referred by or connected to foreign government officials, resulting in millions of dollars of business revenue.
* On July 5, 2018, the SEC announced that Credit Suisse Group AG agreed to pay [https://www.sec.gov/news/press-release/2018-128 $30 million] to the SEC and [https://www.justice.gov/opa/pr/credit-suisse-s-investment-bank-hong-kong-agrees-pay-47-million-criminal-penalty-corrupt $47 million] to the DOJ to resolve charges that it violated the anti-bribery and internal accounting provisions of the FCPA. According to the SEC’s [https://www.sec.gov/litigation/admin/2018/34-83593.pdf order], between at least 2007 and 2013, Credit Suisse provided valuable employment to the relatives and friends of certain foreign government officials as a personal benefit to the requesting officials in order to obtain or retain investment banking business or other benefits for the bank. This quid pro quo arrangement resulted in multiple deals and substantial profits for Credit Suisse. Specifically, the SEC found that in a six-year period, Credit Suisse offered to hire more than 100 individuals referred by or connected to foreign government officials, resulting in millions of dollars of business revenue.
* On August 27, 2018, Legg Mason Inc. paid approximately $34 million to resolve an SEC charge that a subsidiary Permal Group Inc. partnered with Société Générale S.A., to solicit business from state-owned financial institutions in Libya by paying bribes through an intermediary.  Société Générale paid the Libyan Intermediary approximately $26.25 million for supposed “introductory” services and Lybian financial institutions purchased seven structured notes linked to funds managed by Permal that were worth approximately $950 million.  Legg Mason agreed to disgorge approximately $27.6 million of ill-gotten gains and pay $6.9 million in prejudgment interest.
* On August 27, 2018, Legg Mason Inc. paid approximately [https://www.sec.gov/litigation/admin/2018/34-83948.pdf $34 million] to resolve an SEC charge that a subsidiary Permal Group Inc. partnered with Société Générale S.A., to solicit business from state-owned financial institutions in Libya by paying bribes through an intermediary.  Société Générale paid the Libyan Intermediary approximately $26.25 million for supposed “introductory” services and Lybian financial institutions purchased seven structured notes linked to funds managed by Permal that were worth approximately $950 million.  Legg Mason agreed to disgorge approximately $27.6 million of ill-gotten gains and pay $6.9 million in prejudgment interest.
* On September 4, 2018, the SEC announced that Paris-based pharmaceutical company, Sanofi, agreed to pay more than $25 million to resolve charges that its subsidiaries made corrupt payments to win business. According to the SEC’s order, the schemes involved bribing government officials and healthcare providers in order to be awarded tenders and to increase prescriptions of its products. The SEC’s press release indicated that the Commission will continue to focus on bribery in connection with pharmaceutical sales as it remains as a significant problem.  
* On September 4, 2018, the SEC announced that Paris-based pharmaceutical company, Sanofi, agreed to pay more than [https://www.sec.gov/news/press-release/2018-174 $25 million] to resolve charges that its subsidiaries made corrupt payments to win business. According to the SEC’s [https://www.sec.gov/litigation/admin/2018/34-84017.pdf order], the schemes involved bribing government officials and healthcare providers in order to be awarded tenders and to increase prescriptions of its products. The SEC’s press release indicated that the Commission will continue to focus on bribery in connection with pharmaceutical sales as it remains as a significant problem.  
* On September 12, 2018, United Technologies Corporation (UTC) agreed to pay $13.9 million to resolve charges that it violated the FCPA by paying Azerbaijani officials to facilitate the sales of elevator equipment for public housing in Baku and as part of a kickback scheme to sell elevators in China.  The scheme in Azerbaijan involved the use of sham subcontractors and intermediaries to make improper payments. According to the order, the violation in China entailed UTC, through its joint venture, making unsupported payments to a sales agent, “disregarding the high probability that at least some of the money would be used to make unlawful payments to a Chinese official to obtain confidential information to sell engines to a Chinese state-owned airline.”  UTC self-reported the misconduct and timely provided facts developed during its internal investigation.
* On September 12, 2018, United Technologies Corporation (UTC) agreed to pay [https://www.sec.gov/litigation/admin/2018/34-84087.pdf $13.9 million] to resolve charges that it violated the FCPA by paying Azerbaijani officials to facilitate the sales of elevator equipment for public housing in Baku and as part of a kickback scheme to sell elevators in China.  The scheme in Azerbaijan involved the use of sham subcontractors and intermediaries to make improper payments. According to the order, the violation in China entailed UTC, through its joint venture, making unsupported payments to a sales agent, “disregarding the high probability that at least some of the money would be used to make unlawful payments to a Chinese official to obtain confidential information to sell engines to a Chinese state-owned airline.”  UTC self-reported the misconduct and timely provided facts developed during its internal investigation.
* On December 6, 2019, Ericsson agreed to pay over $1 billion to resolve FCPA violations arising out of the Company’s scheme to make and improperly record tens of millions of dollars in improper payments around the world for approximately 17 years. That amount includes $540 million that will be paid to the SEC for disgorgement and prejudgment interest. According to a Department of Justice press release, Ericsson used third party agents and consultants to make bribe payments to government officials and/or to manage off-the-books slush funds. These agents were often engaged through sham contracts and paid pursuant to false invoices, and the payments to them were improperly accounted for in Ericsson’s books and records.
* On December 6, 2019, Ericsson agreed to pay over [https://www.justice.gov/opa/pr/ericsson-agrees-pay-over-1-billion-resolve-fcpa-case $1 billion] to resolve FCPA violations arising out of the Company’s scheme to make and improperly record tens of millions of dollars in improper payments around the world for approximately 17 years. That amount includes $540 million that will be paid to the SEC for disgorgement and prejudgment interest. According to a Department of Justice press release, Ericsson used third party agents and consultants to make bribe payments to government officials and/or to manage off-the-books slush funds. These agents were often engaged through sham contracts and paid pursuant to false invoices, and the payments to them were improperly accounted for in Ericsson’s books and records.
* On June 25, 2020, pharmaceutical company Novartis agreed to pay $346 million to settle SEC and DOJ charges that the company violated the FCPA. According to the SEC’s press release announcing the settlement, between 2012 and 2016 “Novartis or its former subsidiary Alcon Inc. engaged in schemes to make improper payments or to provide benefits to public and private healthcare providers in South Korea, Vietnam, and Greece in exchange for prescribing or using Novartis or Alcon products.”
* On June 25, 2020, pharmaceutical company Novartis agreed to pay [https://www.sec.gov/news/press-release/2020-144 $346 million] to settle SEC and DOJ charges that the company violated the FCPA. According to the SEC’s press release announcing the settlement, between 2012 and 2016 “Novartis or its former subsidiary Alcon Inc. engaged in schemes to make improper payments or to provide benefits to public and private healthcare providers in South Korea, Vietnam, and Greece in exchange for prescribing or using Novartis or Alcon products.”
 
For a detailed list of previous SEC enforcement actions for FCPA violations, click [https://www.sec.gov/enforce/sec-enforcement-actions-fcpa-cases here].


='''Foreign Bribery and FCPA Violations in Real Estate, Construction and Infrastructure'''=
='''Foreign Bribery and FCPA Violations in Real Estate, Construction and Infrastructure'''=