2 Tobacco Firms to Pay $28 Million to Settle Foreign Bribery Charges

Two U.S. tobacco companies have agreed to pay fines and forfeit profits totaling more than $28 million to settle criminal and civil charges of bribing officials in Thailand and other countries.

Federal authorities said the companies, Universal Corp. of Richmond, Va., and Alliance One International Inc. of Morrisville, N.C., paid more than $5 million in bribes to secure tobacco sales contracts, Dow Jones Newswires reports.

The companies settled civil complaints from the Securities and Exchange Commission without admitting or denying the agency’s bribery charges, and entered into non-prosecution agreements to close the Department of Justice’s criminal cases. The companies also agreed to be supervised by independent monitors for three years.

“These large tobacco merchants used secret payments to improperly win business and curry favor with foreign government officials around the globe,” Christopher Conte, associate director in the SEC’s Division of Enforcement, said in a statement.

Universal will pay $8.9 million in disgorged profits and fines, and Alliance One has agreed to pay $19.45 million. The civil and criminal cases were brought under the Foreign Corrupt Practices Act.

Federal authorities said Universal paid about $800,000 in bribes to officials in the government-owned Thailand Tobacco Monopoly  in exchange for $11.5 million worth of tobacco sales contracts. The state-owned tobacco business also received $1.2 million from Dimon Inc. and Standard Commercial Corp.—which merged in 2005 to become Alliance One—in return for $18.3 million in contracts. Officials said the coordinated bribery scheme in Thailand took place from 2000 to 2004.

Alliance One also made improper payments in China, Greece, Indonesia and Kyrgyzstan, where authorities said the misconduct dated back to 1996. Universal, authorities said, bribed officials in Malawi and Mozambique. In some cases, the companies made improper payments to government officials for the exclusive right to purchase tobacco from regional growers, or to secure beneficial legislation.

Print Print  

Like what we're doing? We'd appreciate your support.

Leave a comment