The SEC ordered a large asset manager to pay over $34 Million in disgorgement and interest to settle charges that it bribed foreign officials to obtain investment mandates. The firm also agreed to pay a $32 Million criminal fine and execute a non-prosecution agreement with the Department of Justice. The SEC alleges that employees at the asset manager knew that payments made by a foreign subsidiary to a solicitor were used to bribe foreign officials with power to direct investments by sovereign wealth funds. The SEC accuses the firm for violating the internal control provisions of the Foreign Corrupt Practices Act and for having insufficient internal accounting controls.
OUR TAKE: Compli-pros must implement enhanced procedures when their firms seek to attract foreign government clients. Procedures should include vetting of solicitors and due diligence into payments.