This recent post highlighted the approximate $62 million Foreign Corrupt Practice Act enforcement action against Philips based on conduct in Angola. By resolving another FCPA enforcement action, Philips joined the corporate FCPA repeat offender club.
This post highlights additional issues to consider.
Timeline
As highlighted in this prior post, Philips had been under FCPA scrutiny since at least June 2019.
Thus, from start to finish, the company’s FCPA scrutiny lasted approximately four years.
The Foreign Corrupt Practices Act corporate repeat offender club is getting so large, that it really is not all that exclusive.
In 2013, Koninklijke Philips Electronics N.V. (“Philips”), a Netherlands-based company with shares listed on the New York Stock Exchange, resolved a $4.5 million FCPA enforcement action concerning conduct in Poland. (See here for the prior post).
In resolving the matter, Philips consented to entry of the Order prohibiting future FCPA violations.
Yesterday, the SEC announced that Philips agreed to pay “more than $62 million to resolve charges that it violated the FCPA” with respect to conduct related to its sales of medical diagnostic equipment in China.”
As highlighted in this prior post, in 2012 Oracle resolved a $2 million SEC Foreign Corrupt Practices Act enforcement action finding that “Oracle violated the books and records and internal accounting controls provisions of the FCPA by failing to prevent Oracle India Private Limited from keeping unauthorized side funds at distributors from 2005 to 2007.”
As a condition of settlement, Oracle consented to the entry of a final judgment, among other things, “permanently enjoining it from future violations” of the books and records and internal controls provisions and in resolving the matter the SEC noted the “significant enhancements” Oracle made to its FCPA compliance program.
Yesterday, the SEC announced a $22.9 million FCPA enforcement action against Oracle “to resolve charges that it violated provisions of the FCPA when subsidiaries in Turkey, the United Arab Emirates, and India created and used slush funds to bribe foreign officials in return for business between 2016 and 2019.”
In resolving a second FCPA enforcement action, Oracle becomes the 20th corporate FCPA repeat offender (see here for the list).
What happens when the Greek, Swiss, and South Korean subsidiaries of a Swiss company engage in improper conduct in Greece, Vietnam and South Korea? Why of course, approximately $345 million flows into the U.S. treasury.
Yesterday, Novartis joined the long and growing list of FCPA repeat offenders as the DOJ and SEC announced (see here and here) a combined approximate $347 million enforcement action. (As highlighted in this prior post, in 2016 Swiss pharmaceutical company Novartis coughed up $25 million to resolve a SEC FCPA enforcement action focused on the conduct of its indirect Chinese subsidiaries).
Yesterday’s enforcement action included a DOJ component (in which the company agreed to pay approximately $234 million) and a SEC component (in which the company agreed to pay approximately $113 million).
German healthcare firm Fresenius Medical Care AG (a company with American Depositary Receipt shares traded on the NYSE) has been under FCPA scrutiny since 2012 (no that is not a typo).
Today the DOJ and SEC announced (here and here) an approximate $232 million enforcement action ($84.7 million to the DOJ and $147 million to the SEC) against the company for alleged bribery schemes involving physicians and other healthcare personnel in Angola, Saudi Arabia, Morocco, Spain, Turkey, Gabon, Benin, Burkina Faso, Senegal, Ivory Coast, Niger, Cameroon China, Serbia, Bosnia, and Mexico.
While not specified in any of the resolution documents, the DOJ’s non-prosecution agreement and SEC’s administrative order make generic reference to the Angola and Saudi Arabia conduct involving ‘agents and employees utiliz[ing] the means and instrumentalities of U.S. interstate commerce, including the use of internet-based email accounts hosted by numerous service providers located in the United States.”
