Avon to Spend US$132 Million to Settle China-Related Bribery Probe

Avon Products Inc. will pay the U.S. government US$135 million to settle bribery charges, under a preliminary deal which still needs the final nod of regulators and the company's board of directors.

 

In a filing with the U.S. Securities and Exchange Commission, the company said it would pay $68 million to the U.S. Justice Department and $67 million to the SEC. Under the preliminary agreement, the company secured a deferred prosecution for three years, after which the charges against the company would be dismissed.

 

Avon also disclosed it will install a government-approved compliance monitor for 18 months; after that, it will put in place its own compliance monitor and continue reporting to the government for an additional 18 months.

 

The investigations, which looked into whether bribes were paid to Chinese government officials by the company's management in China to gain favors, started with an internal probe in 2008. Federal regulators began their investigation into the alleged bribery shortly after Avon's internal investigation began, according to the SEC filing.

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