Articles Tagged with Foreign Bribes

Credit Suisse  a Swiss-based issuer of publicly traded securities in the United States, will pay a $47 million to the United States as a criminal penalty for its role in a scheme to corruptly win banking business by awarding employment to friends and family of Chinese officials.

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue of the Eastern District of New York and Assistant Director-in-Charge William F. Sweeney Jr. of the FBI’s New York Field Office made the announcement.

According to CSHK’s admissions, between 2007 and 2013, several senior CSHK managers in the Asia Pacific (APAC) region engaged in a practice to hire, promote and retain candidates referred by or related to government officials and executives of clients that were state-owned entities (SOEs).  The employment of these “relationship hires” or “referral hires” was part of a quid pro quo with the officials who referred the candidates for employment, whereby CSHK bankers sought to and did win business from the referral sources.  Employees of other subsidiaries of CSAG were aware of the referral hires and facilitated the conduct.

Dun & Bradstreet firm will pay $9.2 million to securities regulators to settle charges by the S.E.C. that its subsidiaries in China made unlawful payments to win or keep business from 2006 through 2012.The S.E.C. the illegal payments weren’t properly recorded in the company’s books and the company’s accounting controls were too weak to detect the problem.

Dun & Bradstreet terminated 11 people involved in the misconduct, disciplined others and will pay the SEC “the full amount of disgorgement” determined by the securities regulator. The SEC said the company will pay $6.1 million of profit gained via its misconduct, interest of $1.1 million and a penalty of $2 million, bringing the total to $9.2 million.

Dun & Bradstreet didn’t admit or deny wrongdoing. The company confirmed it resolved matters with the SEC and said it takes seriously its obligation to run its business legally and responsibly.

NEW HAMPSHIRE WHISTLEBLOWER NEWS

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The lease to operate the state-owned ski resort at Mount Sunapee, Och ziff has agreed to pay $413 million to resolve a case involving foreign bribes. The company agreed to pay a criminal penalty of $213 million to the Justice Department and $199 million to the Securities and Exchange Commission.The U.S. Justice Department announced that Och-Ziff and its African subsidiary had entered into an agreement to resolve criminal charges stemming from a scheme to bribe government officials in the Democratic Republic of Congo and Libya.Och-Ziff admits it paid tens of millions of dollars in bribes to Congo officials in exchange for exclusive investment opportunities involving the country’s diamond and mineral mining sectors.

The state attorney general and commissioner of Resources and Economic Development are pushing for a public meeting at which the new leaseholder, Och-Ziff Capital Management Group, can offer assurances that New Hampshire won’t see any of the conduct that resulted in more than $400 million in fines and penalties levied by the U.S. Justice Department and the Securities and Exchange Commission.

According to the Wall Street Journal, emails and other documents reviewed by the paper’s reporters reveal information uncovered by a tipster alleging that Glaxo’s China sales staff provided doctors with speaking fees, cash payments, lavish dinners and all expenses paid trips in return for prescribing the drug company’s products. Glaxo says it is looking into the matter. Like in the U.S., patients in China need a doctor’s prescription to buy regulated drugs and drug sales persons meet frequently with doctors to try to get them to prescribe products. However, unlike the U.S., the government controls all of China’s health care system so any purchased are through government paid physicians. Under the U.S. Foreign Corrupt Practices Act it is illegal for companies with significant U.S. operations to bribe foreign officials or their agents in exchange for business. Whistleblower tipsters are now coming forward to be part of the Securities and Exchange Commission’s new whistleblower program allowing the tipsters a reward of up to 30% of the moneys recovered. The Glaxo whistleblower says that between 2004 through 2010 Glaxo regularly gave cash to its sales staff in China and some of that went directly to doctors at Chinese hospitals in return for prescribing drugs from the company. Recently Glaxo settled a case with the U.S. Department of Justice relating to its drug marketing practices. Under the new SEC program, whistleblowers may come forward anonymously through counsel, thereby protecting themselves. Jeffrey Newman represents whistleblowers. jeffrey.newman1@gmail.com. www.JeffreyNewmanLaw.com

Control Risks, a consultancy which creates an annual forecast of business risks, says that corruption will be the most pervasive operational risk in 2011. The United Kingdom recently passed the UK Bribery Act which will be one of the toughest enforcement laws in any country. Some say it is even tougher than the recently passed Dodd-Frank Act. What this means for business is that companies operating in any way within the UK will no longer be able to make “facilitation payments” and they will have to create compliance officers to make sure the law is not violated. In the U.S., the Justice Department has vowed to enforce the Foreign Corrupt Practices Act prohibiting bribes to foreign officials or their agents. Whistleblowers reporting such bribes will now be able to recover a bounty of up to 30% of what the government recovers or sanctions under The Dodd Frank Act. In some nations it is difficult to do business without payment of bribes or facilitation fees. The scrutiny on such payments has heightened now.

Wikileaks, the web site releasing private government documents, said that among the classified U.S. diplomatic cables about to be released, allege corruption in foreign governments and Reuters is reporting that policitians in Russia, Afghanistan and other Central Asian nations will be named. Under the Foreign Corrupt Practices Act(FCPA) corporations and individuals may not pay bribes to government officials or their agents in order to obtain contracts or other things of value. Jeffrey Newman represents whistleblowers with information about foreign bribes. He can be reached at jeffrey.newman1@gmail.com

Diebold Inc. announced that it received a subpeona for documents from the Securities and Exchange Commission and Department of Justice. Diebold has identified certain transactions and payments by a subsidiary in Russia that could implicate the Foreign Corrupt Practices Act. It is unclear as to whether the information was revealed by a whistleblower.