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Saudi Sovereign Wealth Fund Takes Positions In Several U.S. Companies

publicinvestmentfund

As highlighted in this Wall Street Journal article, the Public Investment Fund (Saudi Arabia’s sovereign wealth fund) recently took positions in numerous U.S. companies. (See here for its recent filing).

As stated in the article:  “The Public Investment Fund in the first quarter bought shares valued at about half a billion dollars each in Facebook, Walt Disney Co., Marriott International, and Cisco Systems …  The fund bought financial stocks, investing $522 million in Citigroup and $488 million in Bank of America Corp, while also spending $714 million on a stake in Boeing.”

While there is nothing inherently problematic under the Foreign Corrupt Practices Act with having a relationship with a sovereign wealth fund, as highlighted below several FCPA enforcement actions have involved individuals associated with sovereign wealth funds.

As highlighted in this post, the 2015 FCPA enforcement action against BNY Mellon Corp was based on findings that the company provided “valuable student internships to family members of foreign government officials affiliated with a Middle Eastern sovereign wealth fund.”

As highlighted in this post, the 2017 FCPA enforcement action against various individuals involved a scheme to pay $2.5 million in bribes to facilitate the $800 million sale of a commercial building in Vietnam to a Middle Eastern sovereign wealth fund.

As highlighted in this post, the 2018 FCPA enforcement action against Societe Generale involved individuals associated with the Libyan Investment Authority – a sovereign wealth fund. As stated in the enforcement action

“Between in or about 2005 and in or about 2011, following the lifting of broad economic sanctions, the Libyan State Agencies sought to place substantial funds with financial institutions for investment purposes. These placements were heavily sought after by a number of financial institutions, including Societe Generale, as well as at least eight U.S.-based financial institutions.”

The related 2018 FCPA enforcement action against Legg Mason also involved individuals associated with the LIA. (See posts here and here).

As highlighted in this post, the 2018 FCPA enforcement action against former Goldman Sachs executives involved individuals associated with 1Malaysia Development Berhad (1MDB) – Malaysia’s state-owned and state-controlled investment development company.

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