Some Foreign Corrupt Practices Act enforcement actions are accompanied by DOJ press releases and much fanfare and some are not.
In the later category, earlier this week this letter was quietly posted to the DOJ’s FCPA website indicating that Safran S.A. (a French company) resolved a $17.2 “declination with disgorgement” enforcement action.
According to the DOJ letter, bribery was “committed by employees and agents of the Company’s U.S. subsidiary Monogram Systems (Monogram) and its German subsidiary EVAC GmbH (EVAC).”
The letter states:
“The Government’s investigation found evidence that from approximately 1999 until 2015, prior to Safran’s acquisition of Monogram and EVAC, these entities paid millions of dollars to a China-based business consultant who was a close relative of a then-senior Chinese government official. Monogram and EVAC paid the business consultant in order to obtain lucrative train lavatory contracts with the Chinese government, while knowing that the funds would be used, at least in part, to pay bribes to a then-senior Chinese government official.”
As stated in the letter:
“The Government has decided to decline prosecution of this matter based on an assessment of the factors set forth in the Corporate Enforcement Policy, Justice Manual … and the Principles of Federal Prosecution of Business Organizations … including but not limited to: (1) Safran’s timely and voluntary self-disclosure of the misconduct; (2) Safran’s full and proactive cooperation in this matter (including its provision of all known relevant facts about the misconduct) and its agreement to continue to cooperate in any ongoing government investigations; (3) the nature and seriousness of the offense; (4) Safran’s timely and full remediation, including termination of a remaining employee involved in the misconduct, withholding the deferred compensation of another employee involved in the misconduct who had previously left the Company, and efforts to enhance its anti-corruption training and compliance program; (5) the fact that Safran was the successor-in-interest to its acquired subsidiaries Monogram and EVAC and that the misconduct ceased pre-acquisition; (6) Safran’s identification of the misconduct through post-acquisition due diligence, which Safran voluntarily disclosed to the Government; (7) the fact that Safran agrees to and will disgorge the full amount of Monogram’s ill-gotten gains to the Government; and (8) that Safran intends to accept responsibility and resolve liability of its German subsidiary EVAC in connection with an ongoing investigation by German authorities.”
Pursuant to the letter agreement, Safran agreed to disgorge $17,159,753 “which represents Mongram’s profits from the corruptly obtained and retained contracts, as calculated by the Government.” The letter further states: “The Government agrees to defer to German authorities in imposing any amount Safran owes resulting from EVAC’s involvement in the same scheme.”
Peter Spivack (Hogan Lovells) represented Safran.