In October 2022, Charles Finkel was charged in a criminal complaint filed in the S.D. of New York with Foreign Corrupt Practices Act violations in connection with an alleged bribery scheme in Brazil.
Finkel was a former executive at Sicpa (a Swiss technology company which provides governments with banknote security inks and secured identification, traceability and authentication solutions).
The criminal complaint stated:
“This case involves a bribery scheme to pay, among others, a Brazilian official (Official- 1) in exchange for lucrative business and business advantages with the Brazilian government. During portions of the relevant time period, Finkel was an executive vice president of Subsidiary- 1, a subsidiary of Company- 1, and the owner of his own consulting firm, Finkel Company- 1, which received over $292 million in payments from Company- 1 and its subsidiaries and affiliates. During the course of the scheme, Finkel paid bribes of over $14 million to Official- 1 and Official- l ‘ s wife (CC- 1) in order to corruptly obtain and retain contracts worth over $1 billion between Subsidiary- 1 and the Brazilian Mint, referred to as the CMB . The vehicle for paying the bribes to Official- 1 was a purported consulting company (i .e. Consulting Company- 1) set up in the name of Official- l ‘ s wife. Finkel furthered the scheme while present in New York, New York, among other places, and caused wire transfers in furtherance of the scheme to be sent from New York, New York to Brazil.”
Set forth below is the current top ten corporate FCPA settlements of all-time actually secured by U.S. law enforcement (in other words net FCPA settlement amounts).
Unlike certain other lists, the below list is calculated after consistently accounting for certain credits or deductions in several enforcement actions involving foreign companies and/or related foreign law enforcement actions.
1. Goldman Sachs
In certain SEC filings, issuers disclose a wide variety of risk factors which could impact its business.
These risk factors often follow a template like structure and may not be the most entertaining read.
Nevertheless, it is sometime interesting to look at the risk factors including any mention of the Foreign Corrupt Practices Act to see what issuers are saying.
Bambusa Therapeutics, Inc. is a “clinical-stage biopharmaceutical company developing next-generation, long-acting precision bispecific antibodies designed to redefine standards of care in immunology and inflammation and fundamentally improve patient quality of life.”
Its recent Registration Statement in advance of an initial public offering disclosed the following risk:
This post highlights fourteen FCPA enforcement actions concerning conduct (in whole or in part) in Angola.
The enforcement action involved conduct in Angola and the allegations: “Beginning in September 2007, Frank’s tried to increase its business in Angola, but learned through an oil company that Sonangol was blocking its hiring and it could no longer use Frank’s to provide tubular services. Senior Frank’s managers learned that Sonangol directed the customer to use a competitor of Frank’s that purportedly made a superior financial investment in Angola. But a senior Sonangol executive relayed that Sonangol could change its mind if Frank’s established a consulting company and paid five percent of the value of the contract to the consulting company for the benefit of high-ranking Sonangol officials.”
Previous posts have highlighted FCPA enforcement actions concerning conduct (in whole or in part) Greece, Georgia and Ukraine, and Poland.
This post highlights FCPA enforcement actions concerning conduct (in whole or in part) in the following countries: Romania, Bulgaria, Hungary, Slovakia, Slovenia, and Czech Republic.
Romania
The enforcement action concerned conduct in Romania and the allegations were: “Between 2007 and 2012, Elbit and Plaza [a majority-owned indirect subsidiary], directly and indirectly, paid millions of dollars to third-party offshore consultants and sales agents purportedly for their services related to a real estate development project in Romania and the sale of a large portfolio of real estate assets in the U.S. However, Elbit and Plaza made these payments even though they had no evidence that the consultants and sales agents had actually provided the contracted for services. Elbit and Plaza failed to properly record those payments in a manner that, in reasonable detail, accurately and fairly reflected the nature of the payments in their books and records. Elbit and Plaza also failed to devise and maintain internal accounting controls sufficient to provide reasonable assurances that company funds would only be used as authorized for legitimate corporate purposes and that transactions were recorded as necessary to maintain accountability for assets, particularly with regard to the accounts payable process.”