Boston Injury Lawyer Blog
The Foreign Corrupt Practices Act, though perhaps not as immediately recognizable by the public as other key pieces of legislation such as the Sherman Antitrust Act, has been repeatedly proven to play a crucial role in protecting the American public and law-abiding business from corporations engaging in illegal bribery and business practices both in the United States and abroad.
Most recently, Alcoa, the world’s third largest aluminum producer was found to be in violation of the FCPA. The Securities and Exchanges Commission alleged Alcoa, along with AWAC (AWAC is a global bauxite mining and alumina refining enterprise between Alcoa Inc. and Alumina Limited) paid numerous bribes to government officials in the country of Bahrain regarding contract negotiations between Alcoa and a major government-operated aluminum plant, according the official SEC press release. According to the Alcoa website, the New York and Philadelphia-based company employs “approximately 60,000 people in 30 countries around the world.” An SEC investigation uncovered more than $110 million in corrupt payments made to Bahraini officials with connections to a key government-controlled aluminum plant.
As is the case with many FCPA violations, the SEC accused the aluminum producing giant of falsely recording these transactions as “legitimate commissions or sales to a distributor.” As a result of this illegal activity, as well as a civil case brought forth, Alcoa has been fined a total of $384 million. This fine is among the largest imposed by the SEC, with the largest being $800 million paid out Siemens AG in 2008. Kara N. Brockmeyer, chief of the SEC Enforcement Division’s FCPA Unit added, “The extractive industries have historically been exposed to a high risk of corruption, and those risks are as real today as when the FCPA was first enacted.”
One of the most popular retail giants in America is not immune to FCPA violation allegations. According to multiple sources including the New York Times and Arkansas Business News, Wal-Mart has already spent more than $230 million on FCPA investigations specifically regarding illegal bribery and poor business practices in its largest international presence, Wal-Mart de Mexico. This case has been dragged out for numerous years and seems to be continuing to move at a slow pace. Top ranking officials in Wal-Mart de Mexico are suspected of engaging in illegal bribery to the tune of $24 million so stores could be opened at a much faster pace than normal procedures would allow. The company has a sizable presence in Mexico; in fact 1 in 5 Wal-Mart stores is located in the Central American Nation. The issue becomes further complicated by the fact that Wal-Mart officials focused more on preventing public relations scandals than actually fixing the problem. The New York Times reported in its exposé that, “Chief Executive [of Wal-Mart’s Mexican division] Eduardo Castro-Wright, identified by the former executive as the driving force behind years of bribery, was promoted to vice chairman of Wal-Mart in 2008.” As the investigation moves forward, more allegations of fraud and cover-ups by Wal-Mart’s team continue to arise.
The United States Securities and Exchanges Committee takes Foreign Corruption Practices Act violations very seriously, especially the Anti-Bribery Provisions. Engaging in corrupt business practices is not only against the law, but also puts smaller businesses that operate within the law at a steep and unfair disadvantage. Other notable cases include pharmaceutical giant Pfizer and its smaller acquisition Wyeth, LLC. According to the SEC official blog, the company made illegal bribes to “doctors and other health care professionals employed by foreign governments in order to win business.” Pfizer and its subsidiaries were fined a combined $45 million. This means that instead of keeping the patient’s best interest at heart, Pfizer was attempting to pay off doctors and health care providers to use their drug for the sake of monetary gain.
When companies participate in bribery and illegal practices, it puts the consumer and the American public at risk. If you suspect any company of violating the FCPA, Altman and Altman can help.
At the Greater Boston Law Firm of Altman & Altman, LLP, our dedicated team of Massachusetts Personal Injury Attorneys understand the difficulties faced by victims. Our attorneys combine the professional expertise of having successfully handled thousands of Personal Injury cases, with the individual attention to understand and respond to the unique nature of your case. We will look into every detail of your case and will explore every legal avenue available in order to deliver legal representation of the highest quality.
At the law offices of Altman & Altman, we are available 24 hours a day, seven days a week – including nights and weekends to answer any questions regarding your case. Call us today to schedule a free initial consultation and case evaluation.
Sources:
Alcoa. Alcoa Resolves Alba Matter with U.S. Government. https://www.alcoa.com/global/en/news/news_detail.asp?pageID=20140109000182en&newsYear=2014 Barstow, David. New York Times. Vast Mexico Bribery Case Hushed Up by Wal-Mart After Top-Level Struggle.
Friedman, Mark. Arkansas Business. Wal-Mart Spends $230 Million on Mexican Bribery Investigation. http://www.arkansasbusiness.com/article/92905/wal-mart-spends-230-million-on-mexican-bribery-investigation?page=all US Securities and Exchanges Commission. SEC Enforcement Actions: FCPA Cases. https://www.sec.gov/spotlight/fcpa/fcpa-cases.shtml US Securities and Exchanges Commission. SEC Charges Alcoa With FCPA Violations. http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370540596936#.UyHHlD-zHz4
