LAN / LATAM Airlines Archives

Friday Roundup

By Mike Koehler on September 9, 2016 in AstraZeneca, Australia, Cisco, Deferred Prosecution Agreements, Fine / Penalty Issues, Foreign Issuers, LAN / LATAM Airlines, Louis Berger International, Related Civil Litigation, Richard Hirsch, Undercover Investigations, United Kingdom

No comment, scrutiny alert, when the obvious is not so obvious, quotable, undercover, follow-up, and for the reading stack. It’s all here in the Friday roundup.

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The recent FCPA enforcement action against Chile-based LAN Airlines (in which the company paid $22 million to resolve DOJ and SEC enforcement actions concerning an alleged payment to resolve an Argentina labor dispute) suggested that both Argentine and Chilean law enforcement officials had commenced investigations of the conduct approximately five years ago.

I’ve tried to find information in the public domain regarding these apparent law enforcement investigations but have generally struck out.

For instance, I contacted LAN’s investor relations office and posed the following question:

Issues To Consider From The LAN Airlines Enforcement Action

By Mike Koehler on July 27, 2016 in Disgorgement, FCPA Statistics, Gray Cloud, Ignacio Cueto Plaza, LAN / LATAM Airlines, Root Causes

This previous post went in-depth regarding the $22 million parallel DOJ and SEC enforcement action against LAN Airlines.

This post continues the analysis of the enforcement action by highlighting additional issues to consider.

Defiant

As noted in connection with the prior SEC enforcement action against Ignacio Cueto Plaza, the conduct at issue is notable for several reasons.

First, the problematic conduct was engaged in by an individual currently with the company. The vast majority of FCPA enforcement actions involve the conduct of former employees.

In Connection With A 2006 Argentine Labor Dispute, Chilean Airline Pays U.S. Government $22 Million

By Mike Koehler on July 26, 2016 in 2016 Enforcement Actions, Airline Industry, Argentina, Books and Records, DOJ Enforcement Action, Foreign Issuers, Ignacio Cueto Plaza, Internal Controls, Labor Issues, LAN / LATAM Airlines, Monitor, SEC Enforcement Action

Five months ago, the SEC brought a Foreign Corrupt Practices Act enforcement action against Ignacio Cueto Plaza (“Cueto”), the Chilean CEO of Santiago, Chile based LAN Airlines S.A. (“LAN”) for authorizing payments in 2006 and 2007 to a third party consultant in Argentina in connection with LAN’s attempts to settle disputes on wages and other work conditions between LAN Argentina S.A. (“LAN Argentina”), a subsidiary of LAN, and its employees.

Yesterday, the DOJ and SEC returned to the same conduct by announcing (here and here) parallel FCPA enforcement actions against LAN.

In short, the end result of an old labor dispute between a Chilean airline and Argentine workers is approximately $22 million flowing into the U.S. Treasury because LAN has shares that are traded on a U.S. exchange.

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Issues To Consider From The LAN Airlines Enforcement Action

In Connection With A 2006 Argentine Labor Dispute, Chilean Airline Pays U.S. Government $22 Million

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