Asia Feels the Sting of US and UK Anti-Bribery Laws

by Abigail Cheadle and Violet Ho, Kroll Advisory Solutions, 15 August 2012

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topics:
Law and Compliance Risk Management

tags:
bribery corporate governance graft and corruption

In January 2012, Japanese trading company Marubeni Corporation agreed to pay a US$54.6 million criminal penalty for the role it played in a decade-long scheme to bribe Nigerian government officials in order to obtain and retain contracts for its client, TSKJ Joint Venture.

In clear violation of the Foreign Corrupt Practices Act (FCPA), the company also entered into a two-year deferred prosecution agreement with the US Department of Justice (DOJ) and agreed to engage an external consultant for two years to review the design and implementation of its compliance program.

Earlier last year, a Japanese engineering and construction company headquartered in Yokohama, JGC Corporation, agreed to pay a US$218.8 million criminal penalty for the role it played in the same scheme, which has become known as the Bonny Island Bribery Scheme.

While at first glance this might seem to be just two more examples of corporate corruption coming to light, the events at Bonny Island hold particular significance for Asia. Despite the fact that Marubeni and JGC are Japanese companies and the officials they bribed were based in Nigeria, both organizations were still held accountable for their actions, sending a very clear message that Asian companies are not immune to the reach of FCPA prosecutors.

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Despite high-profile cases such as these, there is a prevailing attitude of ambivalence among Asian companies, many of whom continue to believe they have no liabilities under global anti-corruption acts. However, this simply isn’t the case and as such, it is absolutely critical that organizations properly understand whether they are exposed to liabilities under this legislation.

Corruption Checklist: Are You Vulnerable?

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