Sweden's Ericsson to pay $1 billion over bribery allegations: US gov't

WASHINGTON - Swedish telecoms firm Ericsson has agreed to pay more than $1 billion to resolve allegations of bribery spanning Asia and the Middle East, the US Justice Department announced Friday.

An Egyptian subsidiary also pleaded guilty in a federal court in New York to a charge of conspiring to violate the 1977 Foreign Corrupt Practices Act.

"Ericsson's corrupt conduct involved high-level executives and spanned 17 years and at least five countries, all in a misguided effort to increase profits," Brian Benczkowski, head of the Justice Department's criminal division, said in a statement.

US law grants jurisdiction over corruption by companies whose shares are sold on American stock markets or if the crime touches the country's territory or its financial system.

Prosecutors say that between 2000 and 2016, the company engaged in a scheme to pay bribes, falsify its books and records and ensure company officials turned a blind eye to the corruption, according to the Justice Department statement.

Alleged corruption occurred in Djibouti, China, Vietnam, Indonesia and Kuwait.

Among other examples, Ericsson admitted that during those years it channeled tens of millions of dollars through consultants and service providers in China, creating a slush fund to lavish gifts, travel and entertainment on foreign officials in order to win business from state-owned telecoms companies.

In a statement on its website, the company said it would not comment on the matter other than to say the figure of $1.2 billion, disclosed in September, "is still its current estimate of the amounts needed to cover the monetary sanctions" and other costs.

The funds are to be split between the Justice Department and the Securities and Exchange Commission, according to the Justice Department.

The two agencies jointly enforce US foreign bribery laws.

The company has also agreed to retain a third-party monitor to oversee its compliance for three years.

A total of 44 countries have enacted laws criminalizing the payment of bribes to foreign officials to win business, but the United States has long been the most active in punishing international corruption.

source: news.abs-cbn.com

Invoking Constitution, Pelosi points to possible bribery charge against Trump

WASHINGTON — House Speaker Nancy Pelosi sharpened the focus of Democrats’ impeachment case against President Donald Trump on Thursday, accusing the president of committing bribery when he withheld vital military assistance from Ukraine at the same time he was seeking its commitment to publicly investigate his political rivals.

The speaker’s explicit allegation of bribery, a misdeed identified in the Constitution as an impeachable offense, was significant. Even as Pelosi said no final decision had been made on whether to impeach Trump, it suggested Democrats are increasingly working to put a name to the president’s alleged wrongdoing and moving toward a more specific set of charges that could be codified in articles of impeachment in the coming weeks.

“The devastating testimony corroborated evidence of bribery uncovered in the inquiry, and that the president abused his power and violated his oath by threatening to withhold military aid and a White House meeting in exchange for an investigation into his political rival — a clear attempt by the president to give himself an advantage in the 2020 election,” Pelosi told reporters at her weekly news conference in the Capitol.

Democrats have begun using the term “bribery” more freely in recent days to describe what a string of diplomats and career Trump administration officials have said was a highly unusual and inappropriate effort by Trump and a small group around him to extract a public promise from Ukraine to investigate former Vice President Joe Biden and a discredited theory about Democrats conspiring with Ukraine to interfere in the 2016 election.

The House Intelligence Committee convened the House’s first public impeachment hearing in two decades Wednesday with testimony from William B. Taylor Jr., the top U.S. diplomat in Ukraine, and George P. Kent, a senior State Department official responsible for policy toward the country.

They told the committee Trump and his allies inside and outside of the government placed the president’s political objectives at the center of U.S. policy toward Ukraine, using both $391 million in security assistance Congress had appropriated for Ukraine’s war with Russia as well as a White House meeting that was coveted by the country’s new leader as leverage.

source: news.abs-cbn.com

US college bribery scandal grates on those who missed the cut

The U.S. college bribery scandal has unleashed angst and fury among parents, students and admissions experts, as an unprecedented criminal investigation draws attention to the privileges afforded to wealthy Americans.

Hollywood actors and business executives are among 50 people charged with taking part in the largest college admissions scandal in U.S. history, which involved getting students into elite, highly selective universities by paying bribes and cheating the admissions process.

Ordinary Americans were not amused.

"I've worked my butt off for four years trying to make myself seem really presentable, studying two hours a week for the SAT (entrance exam) and getting all As in my classes," said Connor Finn, 18, a senior at John Marshall High school in Los Angeles. "And then the fact that people would just pay hundreds of thousands of dollars and without the hard work is really not rewarding at all," he said.

Finn's father, Michael, said the teenager applied to a dozen universities, including University of California, Los Angeles (UCLA), where the daughter of one couple charged in the scandal was enrolled. Connor is still waiting for a response, his father said.

Dan Raffety, a college counselor at the Elgin Academy prep school near Chicago, said he had a student with superb grades, perfect entrance exam scores and a resume full of extracurricular activities who was denied entry at Georgetown.

He said he was angered to think academically deserving students may have lost a spot to cheaters.

ACCESS TO POWER

Besides academic excellence, elite schools offer access for their graduates to a network of people in power.

"At some point this isn't really about education. This is about trying to get access," Rafferty said.

Many elite universities give preference to "legacy" applicants: the children of those who previously attended. In other cases, major financial gifts, including multimillion-dollar donations to construct buildings on campus, pave the way for the privileged. Both practices are legal.

The competition can be fierce and seem unfair even to people of privilege, however.

One wealthy Massachusetts parent said his son had excellent credentials but still was denied entry to Ivy League Brown University, even after the family spent thousands of dollars for a tutor to improve the boy's entrance exam scores.

Meanwhile, he said students whom he considered lesser academic talents gained an advantage by going to private prep schools, whose business model is to get students into elite universities.

"It's a booming business because parents are the ripest target in the world. They'll pay and do anything for their kids. And this (scandal) is an example of things gone awry," said the father, who asked to remain anonymous so he could speak freely.

His son chose to stay in public school and ended up at Tufts University, a highly rated school that nonetheless lacks Ivy League cachet.

LOOKING FOR DIVERSITY, TOO

The top universities have such an excess of qualified applicants they could limit their candidates to the best students with perfect entrance exam scores, admissions experts say.

They are also looking for diversity, accepting high achieving poor and minority students who cannot afford tutors and coaches.

"This scandal, most people would agree, is ridiculous," said Natasha Kumar Warikoo, a graduate professor of education at Harvard and author of "The Diversity Bargain," which examines how students at elite universities view affirmative action.

"But beyond that we don't have a consensus in the United States about what fair is," she added.

UCLA student Sandy Situ, 21, the daughter of immigrants, said the scandal had made her think about the uphill battle for those who are unable to attend the schools of their choice.

"I think about the resources that were taken away from them, the chances that they could have achieved something better, all the people who were turned away for people who could just pay their way in," Situ said. "What a sad moment this is for America." (Reporting by Daniel Trotta; additional reporting by Alex Dobuzinskis and Rollo Ross; editing by Bill Tarrant and Rosalba O'Brien)

source: news.abs-cbn.com

Sanofi to pay $25 million in US over bribery probe

NEW YORK - French pharmaceutical giant Sanofi will pay more than $25 million to settle US charges over bribery committed in Kazakhstan and the Middle East, US authorities announced Tuesday.

The US Securities and Exchange Commission said Sanofi employed a kickback system in Kazakhstan to win public contracts and increase prescriptions of its products. 

In the Middle East, the company employed "pay-to-prescribe" schemes to induce healthcare providers to increase their prescriptions of Sanofi products, the agency said.

"Bribery in connection with pharmaceutical sales remains as a significant problem despite numerous prior enforcement actions," said Charles Cain an SEC enforcement official who leads the unit on the Foreign Corrupt Practices Act.

"While bribery risk can impact any industry, this matter illustrates that more work needs to be done to address the particular risks posed in the pharmaceutical industry," Cain said.

The probe covered Sanofi and its affiliates in Kazakhstan, Jordan, Lebanon, Bahrein, Kuwait, Qatar, Yemen, Oman and the United Arab Emirates for activities between 2006 and 2015.

Sanofi did not admit or deny any wrongdoing.

source: news.abs-cbn.com

South Korea president ousted

Protesters supporting South Korean President Park Geun-hye scuffle with policemen near the Constitutional Court in Seoul, South Korea on Friday. The Constitutional Court of South Korea ousted President Park Geun-Hye over graft issues, including a bribery case involving a Samsung executive.

source: news.abs-cbn.com

Standard Chartered probed in U.S. for Indonesia 'bribes'

Standard Chartered acknowledged Tuesday it was being investigated by the U.S. Department of Justice over claims that an Indonesian subsidiary had paid bribes to secure contracts.

The London-based, Asia-focused bank said in a statement that it had referred the matter to the "appropriate authorities" and launched its own review.

The Wall Street Journal newspaper said that an internal audit at Indonesian energy company Maxpower Group found evidence of possible bribery and US prosecutors were examining whether Standard Chartered was culpable for not stopping it.

"Standard Chartered takes very seriously allegations of impropriety in any of our private equity investments," the bank told AFP in a statement when asked about the report.

"We proactively referred this matter to the appropriate authorities and have conducted our own review.

"When we receive allegations of improper behaviour in an investee company, we pursue those allegations vigorously and act appropriately, including sharing information and cooperating fully with government authorities and addressing any issues of internal conduct and accountability."

The Department of Justice did not comment when contacted by AFP.

The Wall Street Journal said the Maxpower internal audit found that more than $750,000 in cash advances needed to be examined as possible bribes, while lawyers who reviewed the audit found indications that employees made inappropriate payments to Indonesian government officials between 2012 and 2015.

Standard Chartered began investing in Maxpower in 2012 and is the majority shareholder.

There was no immediate comment from Maxpower.

But a source close to the case told AFP the US authorities were indeed examining whether Standard Chartered, via its representatives on the Maxpower board, was aware of alleged bribes to win government contracts.

The investigation would also look at why the bank's alert procedures for spotting such matters had not been triggered.

But the probe will focus on whether Standard Chartered has violated the terms of its 2012 deferred prosecution agreements with the Department of Justice.

Standard Chartered paid $667 million in 2012 to settle charges it violated US sanctions by handling thousands of money transactions involving Iran, Myanmar, Libya and Sudan.

In August 2014, the bank was hit by US regulators with a $300 million fine and restrictions on its dollar-clearing business for failing to detect possible money-laundering.

source: www.abs-cbnnews.com

Wal-Mart may pay millions to resolve Mexican bribery allegations

Wal-Mart is looking into allegations that it engaged in a multiyear bribery campaign in Mexico. It could pay hundreds of millions of dollars in legal expenses and penalties to resolve the allegations.




Wal-Mart Stores Inc. could end up paying hundreds of millions of dollars in legal expenses and penalties to resolve allegations of widespread bribery by officials with its Mexican subsidiary, experts in foreign corruption law said.

The world's largest retailer said it was in the midst of a "worldwide review of our anti-corruption program" and had increased efforts to prevent corruption in Mexico. The Bentonville, Ark., company is looking into allegations that it engaged in a multiyear bribery campaign to build its business.

The allegations come at a time when the Justice Department has been cracking down on foreign corruption. The agency filed some two dozen cases against U.S. companies in 2010, compared with none a decade earlier.

"You have an incredible amount of legal challenges that are going to take part as a result of these failures," said James Post, a business management professor at Boston University. "The board of directors should bring in an outside firm to launch a full investigation. They have to open up the record on everything that's happened here."

He said Wal-Mart also faces shareholder lawsuits, along with criminal charges and potential action by the Securities and Exchange Commission.

Wal-Mart's Mexican subsidiary might have paid $24 million in bribes in order to speed the approval of new stores in Mexico, according to a report from the New York Times. Wal-Mart operates more than 2,000 locations in Mexico, its largest foreign presence.

Investigations of foreign corruption by U.S. companies typically last two to four years and could cost tens of millions of dollars in legal expenses, said Michael Koehler, a Butler University professor.

The bribery allegations "will be used against the company by activists and companies when it attempts to open stores in the U.S. and abroad, and could make it more difficult to attract management talent in international markets," BMO Capital Markets analyst Wayne Hood said.

Wal-Mart shares fell $2.91, or 4.7%, to $59.54 on Monday. Analysts said they fear that the investigation could become a distraction to the company and hamper foreign expansion.

The Foreign Corrupt Practices Act was enacted in 1977 after a series of investigations by the SEC, and hundreds of U.S. companies acknowledged making questionable or illegal payments to foreign government officials and politicians.

Enforcement of the law has become such a concern to business that the U.S. Chamber of Commerce has lobbied for changes. It says that the law is vague and might discourage business.

In Mexico, where Wal-Mart's subsidiary also owns a vast network of supermarkets, family restaurants and clothing stores, the bribery allegations have led to local media coverage and pushed shares down 12% on the Mexican stock market.

Mexican regulators reacted cautiously to the allegations. In Washington for meetings, Finance Secretary Jose Antonio Meade said the government lacked sufficient evidence to move against the firm yet.

Luis Tellez, head of the stock market in Mexico, defended Wal-Mart's performance. He said the retailer has met the market's financial reporting requirements and boosted the Mexican economy by creating jobs.

"Without doubt it has generated wealth in terms of work, wages for its employees and in terms of giving Mexican consumers shopping opportunities at low prices," Tellez said.

The allegations are sure to provide fuel for Wal-Mart detractors south of the border, where the rapid spread of U.S.-style big-box stores threatens traditional, small-time vendors. Critics have also questioned the value of the jobs created by Wal-Mart, saying most of those positions are poorly paid.

Few Mexicans, though, were likely to be shocked at charges that a company had paid bribes.

Mexico has one of the highest corruption indexes among the world's big economies, and greasing the palms of officials is routinely viewed as another cost of doing business by even the most humble street vendor.

source: latimes.com