In 2025, Carlos Leopoldo Alvelais pleaded guilty to a Foreign Corrupt Practices Act offense of some sort in the Western District of Texas. (See here for the prior post).
The facts and circumstances of the enforcement action were unclear as much of the substantive court docket was and remains under seal.
However, last Friday the DOJ announced that “The Scoular Company (Scoular), an agricultural supply chain company based in Omaha, Nebraska, will pay over $10 million to resolve an investigation by the Justice Department into a years-long scheme in which it relied on bribery of Mexican officials to deliver trains of goods across the U.S.-Mexico border.”
According to the DOJ release, Carlos Leopoldo Alvelais was a customs broker who paid bribes on behalf of Scoular.
According to the DOJ release:
“Between 2013 and 2019, Scoular relied on multiple customs brokers to ensure that its shipments of corn and other products successfully crossed from the United States into Mexico. Under Mexican law, those shipments were subject to inspection for dirt, soil, and other impurities. To ensure that Scoular’s shipments successfully transited the border despite inspections that found such dirt, soil, and other impurities, Scoular authorized multiple third-party customs brokers to bribe Mexican officials at the border. At the direction of Scoular employees, and for Scoular’s benefit, those brokers paid bribes of approximately $2,000 per Scoular train and invoiced the bribes back to Scoular for reimbursement of reinspection fees, which Scoular paid. Scoular employees communicated about shipments and bribes via WhatsApp and other means. In total, Scoular authorized bribes of more than $400,000 and avoided fees and costs of more than $6.5 million.”
A criminal information against Scoular was filed in the W.D. of Texas charging conspiracy to violate the FCPA’s anti-bribery provisions and the charge was resolved through a three year deferred prosecution agreement.
The three page information alleges the following overt act in furtherance of the conspiracy.
- On or about June 21, 2013, Carlos Leopoldo Alvelais emailed Scoular Employee 1 and Scoular Employee 2, describing a proposed “procedure” for The Scoular Company to pay a “fee” on every train to ensure that Scoular would “not have a single risk of adverse determinations from Mexican inspectors”
- On or about August 12, 2015, an employee of Carlos Leopoldo Alvelais notified Scoular Employee 1 by email that “the train covered with invoice 489109 for [a Mexican customer] was received today. During the inspection by SAGARPA [Secretaría de Agricultura, Ganadería, Desarrollo Rural, Pesca y Alimentación], soil was detected in the product. The train has been released and will not have delays. This account will include a charge of 2,000 usd by this issue.
- On or about May 2, 2019, an employee of Carlos Leopoldo Alvelais, while in the Western District of Texas, send by e-mail an invoice to The Scoular Company, dated April 15, 2019, that itemized a “SAGARPA process” fee in the amount of $3,000, which The Scoular Company promptly paid.
The DOJ release states:
“As part of the DPA, Scoular agreed to pay a $9,769,521 criminal penalty and $414,351 in forfeiture. Scoular will also continue cooperating with the department in any ongoing or future criminal investigation arising during the term of the DPA. Further, Scoular has committed to implementing a compliance and ethics program designed to prevent and detect violations of the FCPA, and other applicable anti-corruption laws, throughout its operations. Scoular will periodically report to the department on remediation and implementation of compliance measures throughout the term of the DPA.
The department reached this resolution with Scoular based on a number of factors, including, among others, the nature and seriousness of the offense and the determination during the course of the investigation, that, unbeknownst to the company or its employees, a portion of the bribes paid in connection with Scoular’s shipments benefited persons associated with the criminal operations of a cartel operating at the U.S.-Mexico border. Scoular did not receive voluntary disclosure credit pursuant to the Department of Justice’s Corporate Enforcement and Voluntary Self-Disclosure Policy, because it did not voluntarily and timely disclose to the Criminal Division’s Fraud Section the conduct described in the Statement of Facts.
Scoular received credit for its cooperation with the department’s investigation, which included (i) conducting an internal investigation into the misconduct and providing evidence to the department, including detailed factual presentations; (ii) providing information and evidence to the department that identified those involved in the misconduct; (iii) producing and organizing materials in response to the department’s voluntary document requests, notwithstanding certain deficiencies in the early part of the investigation; and (iv) securing counsel for current employees.
Scoular also engaged in timely remedial measures, including (i) increasing compliance sensitivity across the organization through enhanced business engagement; (ii) implementing the findings of an external compliance program maturity assessment and an anti-corruption risk assessment, including by restructuring its compliance function and incorporating senior leadership oversight across compliance and business activities; (iii) reducing operational risk by eliminating the use of customs brokers associated with reinspection fees in Mexico; (iv) strengthening risk-based review and monitoring procedures, and coordinating those efforts through the use of specific software tools; (v) updating and launching a revised Code of Conduct, along with several key policies and procedures related to its compliance program, including anti-corruption, bribery, conflicts of interest, and third party management; (vi) improving and implementing risk-based screenings and approval requirements for third-party providers; implementing anti-corruption and audit right provisions in third-party contracts; (vii) implementing revised financial controls procedures that relate to high-risk transactions, and (viii) providing general and targeted anti-corruption training to relevant personnel.
In light of these considerations, the criminal penalty reflects a 25% reduction from the bottom of the applicable guidelines range, and the term of the DPA is for a period of three years.”
In the DOJ release, Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division stated:
“The Scoular Company used customs brokers as part of a long-running scheme at the Mexican border to pay more than $400,000 in bribes to Mexican officials. A portion of those bribes ultimately benefited people who helped operate a cartel, even though Scoular did not know about it. This resolution shows that bribery and corruption not only undermine fair play and competition for Americans, but also hurt our national security interests in stopping the scourge of dangerous cartel activity.”
U.S. Attorney Justin Simmons for the Western District of Texas stated:
“Nothing crosses into or out of Mexico without the approval and payment to Mexican drug cartels. American businesses that engage in any cross-border trade bear a significant amount of responsibility to do so without benefitting those cartels and without threatening our national security. The bribery scheme in which the Scoular Company engaged demonstrates the dangerous corporate corruption we in the Western District of Texas are committed to fighting on behalf of the American people.”
In a statement, Tim Manning (Scoular Chief Legal Officer and Corporate Secretary) stated:
“The payments at issue occurred between 2013 and 2019. Scoular is a different company today than when the conduct at issue took place years ago and has built a first-in-class compliance program to prevent any future issues. The company has zero tolerance for conduct that violates its compliance policies, procedures and professional standards.
Scoular cooperated fully with the DOJ investigation and took immediate, comprehensive steps to remediate, including terminating the customs broker relationships involved, reorganizing its business teams, completing an external compliance program assessment, strengthening internal controls and monitoring, updating its compliance policies, and expanding anti-corruption training. These significant remediation efforts and full cooperation led to the resolution of this matter.
As Scoular looks toward the future, the resolution allows the company to move forward and continue to serve farmers and customers, guided by its long-held values of integrity and stewardship.”
Scoular is represented by Morrison & Foerster attorneys Brian Nash, Carrie Cohen, Gerardo Gomez Galvis, and James Koukios.
