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Invoice Schemes

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To “fund” a bribery scheme, often times money needs to be “generated” within a business organization.

As highlighted below, in numerous Foreign Corrupt Practices Act enforcement actions the money is “generated” through an invoicing scheme with a third party.

The below enforcement actions are not the complete list of enforcement actions to involve an invoicing scheme, but rather representative examples.

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SAP Joins The Repeat Offender Club

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In 2016 SAP (a German software company with American Depository Shares registered with the SEC) resolved a $3.9 million Foreign Corrupt Practices Act enforcement action.

As highlighted here, in 2019 the company disclosed additional FCPA scrutiny and stated: “SAP has received communications and whistleblower information alleging conduct that may violate anti-bribery laws in South Africa, the United States (including the U.S. Foreign Corrupt Practices Act (FCPA)), and other countries.”

Yesterday, SAP joined the ever-growing FCPA repeat offender club as the DOJ and SEC announced (here and here) related FCPA enforcement actions against the company. The net FCPA settlement amount is $102.5 million: DOJ ($63.6 million) and SEC ($38.9 million).

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Freepoint Commodities Resolves FCPA Enforcement Action

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In February 2023, the DOJ announced that Glenn Oztemel (previously employed by Freepoint Commodities LLC) and Eduardo Innecco (an agent for the company) were charged with FCPA and related offenses for an alleged Brazil bribery scheme. (See here for the prior post).

In summary fashion, the indictment alleged:

“Between in or about 2010 and continuing until in or about 2018, Glenn Oztemel and Eduardo Innecco, together and with others, agreed to pay, and did pay, bribes to foreign officials at Brazil’s state-owned and state-controlled oil and gas company, Petroleo Brasileiro S.A. – Petro bras (“Petrobras”), on behalf of Trading Company #1 and Trading Company #2. In exchange for the bribes, foreign officials at Petrobras, including Rodrigo Berkowitz (“Berkowitz”), who has been charged separately, provided Oztemel, Innecco and others with confidential information related to Petrobras’s business. The inside information and other improper assistance Berkowitz provided to Oztemel, Innecco and others gave Trading Company #1 and Trading Company #2 improper business advantages in trades with Petrobras.

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Chemical Company Albemarle Resolves A Net $218.4 Million Enforcement Action

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As highlighted in this prior post, in February 2018 Albemarle Corp. (a North Carolina based chemical company) disclosed Foreign Corrupt Practices Act scrutiny.

More than 5.5 years later, the DOJ and SEC announced a net $218.4 million FCPA enforcement action against the company.

The resolution included a DOJ non-prosecution agreement (pursuant to which the company agreed to pay a $98.2 million criminal penalty and $16.6 million in forfeiture) and an SEC administrative order (pursuant to which the company agreed to pay approximately $103.6 million in disgorgement and prejudgment interest).

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Billboard Worthy: Clear Channel Outdoor Resolves $26.1 Million Enforcement Action

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Approximately 5.5 years ago (see here for the prior post), Clear Channel Outdoor Holdings (a public subsidiary of iHeartMedia and one of the world’s largest outdoor advertising corporations) disclosed FCPA scrutiny based on the conduct of “several employees of Clear Media Limited, an indirect, non-wholly-owned subsidiary of the Company whose ordinary shares are listed …. on the Hong Kong Stock Exchange.”

Today, the SEC (an enforcement agency whose officials have previously stated that it “should focus on bringing matters to resolution swiftly”) announced a $26.1 million FCPA enforcement action against the company.

In summary fashion, this administrative order finds:

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