[This post is part of a periodic series regarding “old” FCPA enforcement actions]
In early January 2005, the DOJ used a deferred prosecution agreement for the first time to resolve a Foreign Corrupt Practices Act enforcement action. The “guinea pig” was Monsanto.
This post highlights the DOJ and parallel SEC enforcement action against the company (aggregate settlement amount of $1.5 million) based on conduct in Indonesia.
Last Friday the SEC announced that Cardinal Health Inc. agreed to pay $8.8 million to resolve a Foreign Corrupt Practices Act enforcement action.
The action is based on a Cardinal entity (acquired in 2010 and sold in 2018) maintaining and operating marketing accounts for certain customers in China.
In summary fashion, the SEC order states:
Transparency, hilarious, fact-checking, little sense, just saying, and for the reading and listening stack. It’s all here in the Friday roundup.
Transparency
The Project on Government Oversight (POGO) recently this document titled “Baker’s Dozen: 13 Policy Areas That Require Congressional Action” noting that a “lack of transparency around enforcement of the FCPA leaves lingering questions about its utility.” POGO then proposes:
Yesterday, the SEC announced that United Technologies Corporation resolved a $13.9 million Foreign Corrupt Practices Act enforcement action.
The conduct at issue concerned Otis Elevator Co. (a wholly-owned subsidiary of UTC), Pratt & Whitney (an operating division of UTC), and International Aero Engines (a joint venture of five aerospace companies including Pratt & Whitney) regarding a Russian and Azerbaijani improper payment scheme, a China aviation scheme, improper payments for Otis Elevator sales in China, and leisure travel for foreign officials from several countries including China, Kuwait, South Korea, Pakistan, Thailand, and Indonesia.
If history is any guide, September is likely to be an active month for Foreign Corrupt Practices Act enforcement as the SEC’s fiscal year ends.
Sure enough, yesterday the SEC announced an enforcement action against Paris-based pharmaceutical company Sanofi. The conduct at issue focused on employees and agents of the company’s subsidiaries in Kazakstan and various Middle Eastern countries providing things of value to “foreign officials, including healthcare professionals, in order to improperly influence them and increase sales of Sanofi products.”
In doing so, the enforcement action once again raises the policy issue of the U.S. bringing an enforcement action against a foreign company (domiciled in a country also party to the OECD Convention) for its interaction with non-U.S. officials. (See here for a prior post).
