FCPA Violations in Mexico

WAC Settles FCPA Violations in Mexico

Miriam Konradsen Ayed
Miriam Konradsen Ayed

Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover FCPA violations in Mexico, a criminal case opened against FIFA’s president, and the former Colombian President’s house arrest for corruption charges. Read these stories and more news below:

Top Story

WAC Settles FCPA Violations in Mexico

The World Acceptance Corporation has been charged with FCPA violations in Mexico and is to pay USD 21.7M in penalties and disgorgement to settle the charges brought by the SEC. WAC reached the settlement without admitting or denying the charges. Reportedly, a Mexican subsidiary of the consumer loan company bribed government and union officials directly or via intermediaries a total of USD 4.1M in order to retain or win new business in Mexico related to its Préstamos Viva business line (Viva) from at least late 2010 until mid-2017. Reportedly, the DOJ also conducted an investigation in the same corrupt activities in Mexico yet declined to prosecute citing the company’s self-disclosure, proactive cooperation, and remediation as reasons behind. 

Business

U.K. SFO Secures GBP 5.45M Confiscation Order Against Ex-Afren CEO and COO

The U.K. Serious Fraud Office (SFO) announced two confiscation orders totaling GBP 5.45M against the former CEO Osman Shahenshah and COO Shahid Ullah of the oil company, Afren. Shahenshah will pay GBP 2.9M and Ullah GBP 2.5M. The former executives were found guilty of fraud and money laundering in 2018 and were charged for deceiving the board of Afren by putting forth a USD 300M deal in which they obtained a USD 17M gain. In the scheme, one of Afren’s Nigerian oil partners would pay 15% of the payment to an offshore shell company in Bermuda controlled by the executives. According to the SFO, the deal was allegedly put in place after shareholders objected to the GBP 6.6M and GBP 3.8M salaries the executives were receiving, and threatened with potential lower future remuneration.

Former Technip, Keppel Consultant Sentenced to Probation

An intermediary who facilitated bribes between two oil-services companies, TechnipFMC PLC and Keppel Offshore & Marine Ltd., to obtain business with Brazilian state-owned Petróleo Brasileiro SA (Petrobras), has pleaded guilty of corruption. Zwi Skornicki, who worked as a consultant for the oil services companies received USD 69M for his services in 2017, passed a portion of the earnings to Brazilian government officials. Skornicki, who also pleaded guilty to FCPA violations in 2019, will pay a USD 50,000 fine. 

Criminal Case Opened Against FIFA President

Swiss prosecutors have opened a corruption probe into FIFA’s current president Gianni Infantino for alleged collusion. Infantino is accused of having spoken with Switzerland’s attorney general Michale Lauber during a federal investigation into possible corruption at FIFA. The prosecutors, who are requesting to strip Lauber of his immunity from prosecution are alleging that Infantino and Lauber had several meetings during the investigation, constituting an abuse of public office and a breach of official secrecy. Infantino has denied all allegations of collusion and stated that meeting with the country’s Attorney General is not only legitimate but also part of the ‘fiduciary duties of the President of FIFA.’

Government

New York’s Attorney General Sues the NRA and Four of its Top Leaders for Corruption

New York’s attorney general filed a lawsuit seeking to dissolve the country’s most powerful gun right’s lobby, arguing that, for years, the National Rifle Association has been corruptly and illegally diverting USD tens of millions from the group through inflated expenses and contracts in favor of relatives and close associates. The attorney general also sued and sought USD tens of millions in restitution from four current and former members of NRA’s senior leadership, including CEO Wayne LaPierre, general counsel John Frazer, former top lieutenant Josh Powell, and former CFO Wilson Phillips. The move is yet another nail in the coffin of the organization which has been plagued by political infighting and distress as well as allegations of mismanagement and lavish spending by top leaders. 

Former Colombian President Put Into House Arrest for Corruption Charges

Alvaro Uribe, Colombia’s former president, was detained by Colombian authorities under an order of the Supreme Court amid an investigation into bribery, fraud and evidence tampering. Uribe, who was president from 2002 to 2014, is regarded as Colombia’s most influential politician. The court’s decision marks a milestone for a country where high-level political figures are rarely prosecuted and where no former presidents have been formally detained before. The investigation is one of the many that the Supreme Court has conducted into Mr. Uribe over the years and centers around the former president’s alleged connection to paramilitary groups and witness tampering. While the court still has to rule whether there is enough evidence for a trial, Uribe has denied all allegations. Colombian justice allows judges to detain an accused in case they perceive a high risk of flee or evidence tampering.

King Juan Carlos Leaves Spain Amid Corruption Investigation

Spain’s former king, Juan Carlos, announced on the royal website that he was leaving the country. The announcement gave no details on his destination, yet some sources suggest that he relocated to the Dominican Republic. The former king has, since June 2020, been the center of the country’s Supreme Court corruption investigation into a Saudi Arabian contract to build a high-speed rail link between Median and Mecca. Spanish firms won the EUR 6.7B deal, yet Spanish anti-corruption officials claim that Juan Carlos kept some undeclared funds in Switzerland. Swiss banks are also being probed in Swiss-led investigation. The former king stated that he would be available if prosecutors needed to reach him.

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