Another hefty financial penalty for breaching the anti-bribery provisions of the US FCPA

As announced recently by the U.S. Securities and Exchange Commission (the “US SEC”), VimpelCom Ltd., a telecom company, agreed to pay over USD 795 million for breaching the anti-bribery provisions of the US FCPA, under a settlement with the US Department of Justice (“DOJ”), US SEC and the Danish regulator in a corruption case involving foreign public officials.[1]

VimpelCom with its registered seat in Amsterdam is the sixth largest global telecom company. Its securities are traded on the US Stock Exchange. The company announced publically that an investigation was launched against it by the US SEC and the Danish regulator two years ago, i.e. on 12 March 2014.[2]

The charges brought against VimpelCom concerned offering and paying bribes to public officials in Uzbekistan at the time when the company was entering the Uzbek market. The US SEC accused it of paying bribes of at least USD 114 million between 2004 and 2012 through a company having relationships with a public official, while ca. half a million dollars were offered to support several charities, also related to a public official in Uzbekistan.[3]

VimpelCom agreed to pay USD 167.5 million, USD 230.1 million and USD 397.5 million, respectively, to SEC, DOJ and the Danish regulator.

It should be emphasized that the settlement of USD 167.5 million is third on the disgraceful list of the highest penalties charged by US SEC for breaching the US FCPA on record [4]:

  1. Siemens:    USD 350 million in 2008
  2. KBR:         USD 177 million in 2009
  3. VimpelCom:USD 167.5 million in 2016
  4. Alcoa:        USD 161 million in 2014
  5. Total S.A.: USD 153 million in 2013
  6. Snamprogetti:USD 125 million in 2010
  7. Technip:     USD 98 million in 2010
  8. Daimler:     USD 91.4 million in 2010
  9. Avon:         USD 67.3 million in 2014
  10. Pfizer:      USD 45.2 million in 2012

[1] https://www.sec.gov/news/pressrelease/2016-34.html

[2] https://www.telenor.com/media/in-focus/vimpelcom-ltd/vimpelcom-investigation/

[3] https://www.justice.gov/opa/pr/vimpelcom-limited-and-unitel-llc-enter-global-foreign-bribery-resolution-more-795-million

[4] http://www.fcpablog.com/blog/2016/2/23/vimpelcom-fcpa-disgorgement-is-third-biggest-ever.html#sthash.Yg0UFnYX.dpuf

Related posts:

Aggressive enforcement of the FCPA: tough American anti-bribery law

Stryker fined USD 13.2 million for FCPA – infringing business practices carried out in various countries, including Poland

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