Summer may be a slow time on the stock market but we’re getting a steady stream of bribery news with just two months left in the government’s fiscal year. On the FCPA front: Embraer announced that it has reserved $200 million for a settlement under the U.S. Foreign Corrupt Practices Act. Internationally: Germany and the U.K. have expanded their investigations into bribery allegations involving Rolls Royce.
Embraer and Brazil
Embraer, a Brazilian aircraft manufacturer, has been under investigation by the SEC and DOJ over payments to a Dominican Republic official for around 5 years now. Brazil charged eight employees of the company criminally in 2014 – one of the first efforts of the country to prosecute its citizens for bribery abroad. The announcement it reserved $200 million came in its financial disclosures to investors required by the SEC as part of its registration to trade on the New York Stock Exchange.
Brazil has been mired in corruption scandals for the past few years, with a federal court in Brazil accepting obstruction of justice charges against the country’s former President Luiz Inacio Lula da Silva with regard to the investigation into Petrobras.
In news outside of the US and Brazil: Germany and the United Kingdom have both extended their investigations into bribery at Rolls-Royce. Rolls Royce has been under investigation for alleged bribery in China and Indonesia.
In May, U.K. broadened the investigation by the Serious Fraud Office to include the company’s former operations in Nigeria, according to media reports. Now, Germany is investigating the company’s actions in seven Asian countries. Rolls Royce previously paid a fine to South Korea over bribery by MTU Friedrichshafen to sell defense products.
Rolls Royce was the second-largest manufacturer of airplane engines in 2013. it also manufacturers automobiles; engines for ships, rail and defense vehicles; and drive systems for the oil and gas industry.
To speak to one of our SEC whistleblower attorneys about reporting a violation of the FCPA, please call 1-800-590-4116.