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Compendium Roundup
The U.K.'s Serious Fraud Office ("SFO") was particularly active in July. The SFO started criminal proceedings against Alstom S.A.'s U.K. subsidiary, Alstom Network U.K. Ltd., charging it with three corruption offenses, and three counts of conspiracy to corrupt based on allegations that the company paid millions of dollars in bribes to win contracts concerning large transport projects in India, Poland and Tunisia. The SFO also began a formal investigation into U.K.-based construction services company, Sweett Group. The investigation is based on allegations that a former Sweett Group employee, based out of Dubai, offered to award design work on a USD $100 million hospital construction contract in Morocco to a New York-based architecture firm, if it agreed to pay a bribe to a United Arab Emirates official. In another case, four employees of Airbus S.A.S. were arrested as part of the SFO's criminal investigation into allegations that the company gave Saudi Arabian officials cars, jewelry, and cash to win a USD $3.38 billion communications contract. In addition, a former CEO of Aluminium Bahrain BSC ("Alba") began a sixteen-month prison term in the U.K. after being charged by the SFO for paying bribes to former Bahraini officials between 1998 and 2006 in return for raw material supply contracts for Alcoa worth over USD $3 billion.
On the U.S. anti-corruption front, Smith & Wesson Holding Corporation agreed to pay USD $2 million to the U.S. Securities and Exchange Commission ("SEC") to settle charges that it violated the U.S. Foreign Corrupt Practices Act ("FCPA"), after last month receiving a declination from the U.S. Department of Justice ("DOJ") for its role in the Africa Sting Operation. The SEC alleged that Smith & Wesson's international sales staff attracted new business by providing illegal payments and gifts to government officials in Pakistan, Indonesia, Turkey, Nepal, and Bangladesh in violation of the FCPA.
There have also been developments for GlaxoSmithKline plc, Japan Transportation Consultants Inc., Glenn Defense Marine Asia, Deutsche Bank AG, Finmeccanica S.p.A., and Bizjet International Sales and Support, Inc.
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On the Blog
This month, TRACEblog examined United States v. Esquenazi, where the US Eleventh Circuit confirmed a broad reading of "government instrumentality" under the Foreign Corrupt Practices Act. Although the court's definition requires showing government control and public function, key questions remain over how to apply the court's multi-factor test. The blog also featured a two-part series looking at charitable contributions and the evolving corruption scandal surrounding the royal family in Spain.
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Articles Written by TRACE
Severin Wirz, Manager of Advisory Services
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Benchmarking: Commission Rates
The 2014 TRACE Commission Benchmarking Project provides data on the average commission rates paid to third parties on a country-specific basis for business-to-government deals based on four deal sizes. Each segment covers four or five countries within a region. The results for the South America segment are now available. Companies that participated should have received a copy of the results. If you participated but did not receive a copy, please email hsieh@TRACEinternational.org.
You may now access the survey for the Middle East segment, which includes Saudi Arabia, Israel, United Arab Emirates, Oman and Egypt, here. Survey responses are submitted anonymously, so please register your company's participation via email to hsieh@traceinternational.org to receive a copy of the results.
Please submit only one response per company by Friday, August 15th.
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Poll - July's Biggest Bribery Development
Take a moment to take our poll and vote for which headline you think was most newsworthy this month:
- UK's Serious Fraud Office Charges Alstom Network UK with Corruption: The investigation, which commenced as a result of information provided to the SFO by the Office of the Attorney General in Switzerland, concerns large transport projects in India, Poland and Tunisia in the early 2000s. None of the charges fall, however, under the UK's 2010 Bribery Act.
- China Launches Formal Investigation of Zhou Yongkang for Graft: China put an end to years of speculation when it brought charges this month against Mr. Zhao, who was formerly in charge of the country's entire state security, courts, police and paramilitary forces until retiring two years ago.
- U.S.-based Firearms Manufacturer to Pay $2 million to Settle SEC Corruption Charges: Smith & Wesson Holding Corporationagreed to pay $2 million to the U.S. Securities and Exchange Commission to settle charges that it violated the U.S. Foreign Corrupt Practices Act, after last month receiving a declination from the U.S. Department of Justice for its role in the Africa Sting Operation.
- U.S. Corruption Trial of Former Virginia Governor Bob McDonnell Begins: McDonnell and his wife were indicted in January on federal corruption charges following a months-long federal investigation into gifts McDonnell received from a political donor. The former Governor has adopted a unique defense strategy, claiming that his marriage was too unhappy and disjointed for either partner to have conspired with the other to accept bribes.
- More Whistleblowers Come Forth in GSK Bribery Investigation: Starting in China, bribery claims against British drug maker GlaxoSmithKline have surfaced in other countries as well over the past year, including Poland, Iraq, Jordan and Lebanon. This month, allegations emerged that the company paid bribes to Syrian doctors, dentists, pharmacists and government officials to win tenders and to obtain improper business advantages.
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Test your knowledge of the murky world of bribery and the flourishing field of compliance with our new weekly quiz. Authored by TRACE President,
Alexandra Wrage, the Wednesday InterWRAGEtory will feature a new multiple choice question related to anti-bribery and corruption each week. In addition to providing an entertaining way to test your knowledge of anti-bribery facts, the quiz can be used to enhance any training program.
Sign up for our mailing list to receive weekly reminders when the next question is posted. You can also use our Contact Us page to suggest new topics and questions for inclusion in the quiz.
July Quiz Questions:
July 2, 2014
Which resource-rich African country is nevertheless ranked most favorably of all African nations on Transparency International's Corruption Perception Index?
July 9, 2014 If a company is debarred by the World Bank for one year or longer, it is also automatically debarred ("cross-debarred") by which other organization?
July 16, 2014 Where do the fines collected by the U.S. Department of Justice for FCPA violations go?
July 23, 2014 Which actor first mentioned the FCPA by name in a movie making us believe, briefly, that compliance can be glamorous?
July 30, 2014
Which agency is responsible for enforcing the Canadian Corruption of Foreign Public Officials law (CFPOA)?
Answer here.
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Featured Resource: TRACE's New Online Training Module - Conflicts of Interest
TRACE is pleased to announce the release of its Conflicts of Interest online training module, the most recent addition to our customizable online training platform. There are many circumstances which constitute or may give rise to a conflict of interest in the normal course of business, and often, they are misunderstood or overlooked by employees and third parties. Using hypothetical examples, this interactive course aims to help employees and intermediaries recognize different types of conflicts of interest in the workplace. The course also provides guidance on the appropriate action to take when faced with an apparent or potential conflict of interest.
- Unlimited access to this module is included in TRACE annual membership.
- Available in English, with 13 additional languages coming soon.
- Administrative dashboard for easily managing and recording training results.
- Real-life scenarios teach appropriate conduct in a variety of situations.
- Ability to customize platform by uploading your company's logo, messaging and policies.
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TRACE Anti-Bribery Specialist Accreditation (TASA)
TASA (TRACE Anti-Bribery Specialist Accreditation) offers the most comprehensive, high-quality and easily accessible anti-bribery education on the market. TASA boasts over 100 online courses taught by a world-renowned faculty of anti-bribery experts. Candidates have access to an extensive library of recorded webinars as well as live webinars, scheduled regularly throughout the year. Earlier this week, TRACE offered a complimentary TASA webinar on anti-bribery risk assessments and compliance audits to provide a glimpse into the TASA program. The course was taught by Eileen Radford, Director of Advisory Services at TRACE, and is available here.
The July 28, 2014 complimentary TASA course is available on YouTube. Click here to watch. |
Upcoming live TASA accredited TRACE events:
September 29, 2014 *New York
October 30, 2014 *Istanbul
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TRACE Roundtables offer senior-level compliance professionals an opportunity to participate in an advanced discussion on the latest anti-bribery enforcement trends and compliance best practices. Roundtables are led by a TRACE representative and feature special guest speakers. Upcoming roundtables are listed below.
New York, September 29, 2014
The agenda for this event is under development.
Istanbul, October 30, 2014
This event will be held in association with Etik ve İtibar Derneği (TEİD).
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Save the Date: 11th Annual TRACE Forum
The 11th Annual TRACE Forum will be held March 25-26, 2015 at the St. Regis in Washington, DC. TRACE members should plan now to attend what has become the premier anti-bribery benchmarking conference.
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The S3 Story: Due Diligence as a Business Advantage
A growing number of small-and-medium sized enterprises (SMES) around the world are completing TRACEcertification every day at the request of their business partners, or on their own initiative, demonstrating their commitment to commercial transparency. At the same time, more and more multinational companies across industries are accepting TRACEcertification in lieu of their own due diligence procedures. Eliminate third party screening costs and join this global compliance movement by asking your third parties to become TRACE Certified today. Share our June 2014 case study
with your third parties to illustrate the business value of compliance.
"It signals that we aren't just saying we are an ethical company, but by working with a partner who is committed to international transparency, we're keeping good company."
- Aksel Sidem, General Manager, S3 International
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AUGUST
Pro-Active Defenses Against White Collar Crime in China
Seattle, WA
August 14-15, 2014
*Alexandra Wrage, TRACE President, speaking
SEPTEMBER
Washington, DC
September 10-11, 2014
*Eileen Radford, Director, Advisory Services, speaking
Chicago, IL
September 14-17, 2014
TRACE International is proud to be sponsoring and exhibiting at SCCE's 2014 Compliance & Ethics Institute.
*TRACE Representative, attending
New Delhi, India
September 22-23, 2014
*TRACE Representative attending
Houston, TX
September 22-23, 2014
*Alexandra Wrage, TRACE President, speaking
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International Regulatory Updates
 Brazil
Vitor Costa Advogados
http://www.vcadv.com.br/
In Brazil, the Code of Conduct of the High State Public Officials of Rio de Janeiro State established a new increased limit of R$ 1.000 (one thousand Reais) as the value of gifts, hospitality and other benefits that can be given to and received by public officials of Rio de Janeiro State.
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Sincerely,
151 West Street
Annapolis, Maryland 21401
410-990-0076 | 410-990-0707 (fax) www.traceinternational.org |
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