Philips Joins The Corporate FCPA Repeat Offender Club
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.”
Frank’s International Resolves $8 Million FCPA Enforcement Action
The SEC has announced that Frank’s International N.V., (a Dutch oilfield services provider) now known as Expro Group Holdings N.V., has resolved an approximate $8 million Foreign Corrupt Practices Act enforcement action.
The conduct at issue based focuses on Angola and occurred between 2008 and 2014 (in other words approximately 10-15 years ago).
This administrative order finds in summary fashion:
SEC Brings $4 Million Enforcement Action Against An Irish Company (The Successor In Interest To A Canadian Company) For Paying Consultants In Russia In An Effort To Legalize Poker In Russia
This recent post about the Rio Tinto FCPA enforcement action posed the lingering question of whether FCPA enforcement is a convenient cash cow for the U.S. government. After all, when several former FCPA enforcement officials suggest as much, what are the rest of us supposed to think?
After all, in the Rio Tinto matter the U.S. extracted $15 million from a company (with headquarters in Australia and the United Kingdom) after the SEC found that the company hired a French investment banker and close friend of a former senior Guinean government official as a consultant to help the company retain mining rights in Guinea. Even though both Australia and the United Kingdom have laws and law enforcement resources to adequately address the conduct at issue, the SEC nevertheless got involved because the company had American Depository Shares that traded on a U.S. exchange.
Earlier this week (and on the same day as the Rio Tinto matter was announced), the SEC also announced a $4 million FCPA enforcement action against Flutter International (a company headquartered in Ireland) – the successor in interest to The Stars Group (a company that was headquartered in Canada) – based on the finding that the “Company paid approximately $8.9 million to consultants in Russia in support of the Company’s operations and its efforts to have poker legalized in that country.” Even though both Ireland and Canada have laws and law enforcement resources to adequately address the conduct at issue, the SEC nevertheless got involved because The Stars Group at one time had shares traded on a U.S. exchange.
SEC Extracts $15 Million From Rio Tinto In First Corporate Enforcement Action Of 2023
In the minds of some (including former FCPA enforcement officials – see here), Foreign Corrupt Practices Act enforcement is a convenient cash cow for the U.S. government.
Those who believe this will find new support in the first corporate FCPA enforcement action of 2023.
The basic findings are as follows.
Approximately 12 years ago, Rio Tinto (a metal and mining company with headquarters in Australia and the United Kingdom) hired a French investment banker and close friend of a former senior Guinean government official as a consultant to help the company retain mining rights in Guinea.
Even though both Australia and the United Kingdom have laws and law enforcement resources to adequately address the conduct at issue, the U.S. nevertheless extracted $15 million from Rio Tinto because the company had American Depository Shares that traded on a U.S. exchange.
ABB Becomes The First Company To Resolve THREE FCPA Enforcement Actions
The first time ABB resolved a Foreign Corrupt Practices Act enforcement action was in 2004 concerning conduct in Nigeria, Angola and Kazakhstan.
The second time ABB resolved an FCPA enforcement action was in 2010 concerning conduct in Mexico as well as in connection with the Iraqi U.N. Oil for Food program.
Since 2017 (see here for the prior post), ABB has been under additional FCPA scrutiny and last Friday ABB became the first company to resolve an FCPA enforcement action for a third time. The latest enforcement action concerned conduct in South Africa and the net FCPA settlement amount was $147.5 million (a DOJ component of net $72.5 million and an SEC component of net $75 million).