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US JUSTICE DEPT LAYS CHARGES IN BRAZILIAN CIGARETTE SCAM
BKK Post Published: 8/08/2010 at 12:00 AM
Thailand Tobacco Monopoly officials have been accused of accepting bribes of over US$1.93 million (62 million baht) from US-based companies to ensure Brazilian-grown tobacco was sold locally, says the US Justice Department.
The accusations came after two American tobacco companies agreed on Friday to pay nearly US$30 million to settle charges that they bribed foreign officials to get lucrative overseas tobacco sales contracts.
Local officials could not be reached for comment yesterday.
Universal Corp of Richmond, Virginia, and Alliance One International of Morrisville, North Carolina, face civil and criminal charges from the Securities and Exchange Commission and the Justice Department.
Universal was accused of bribing officials in Thailand, Malawi and Mozambique, while Alliance One was accused of bribing officials in Thailand, China, Greece, Indonesia and Kyrgyzstan.
Alliance One pleaded guilty to three counts of conspiring to violate the US's Foreign Corrupt Practices Act (FCPA).
"The charges relate to bribes paid to Thai government officials to secure contracts with the Thailand Tobacco Monopoly, a Thai government agency, for the sale of tobacco leaf," the Justice Department said.
Alliance One was formed in 2005 from the merger of Dimon Incorporated and Standard Commercial Corporation, two tobacco wholesalers.
It buys, processes and sells tobacco to manufacturers worldwide.
The guilty pleas relate to the conduct of employees and agents of foreign subsidiaries of both Dimon and Standard prior to the 2005 merger, the US Justice Department said.
The department said that it had also filed two counts against Universal Brazil for conspiring to violate the FCPA by paying bribes to Thailand Tobacco Monopoly employees for the sale of Brazilian tobacco.
It didn't say how many Thai officials were involved.
The Justice Department said that from 2000 to 2004, Dimon, Standard and Universal Brazil sold Brazilian tobacco to the Thailand Tobacco Monopoly.
No Thai officials were named by the department.
"Each of the three companies retained sales agents in Thailand, and collaborated through those agents to apportion tobacco sales to the Thailand Tobacco Monopoly among themselves, co-ordinate their sales prices, and pay kickbacks to officials of the Thailand Tobacco Monopoly in order to ensure that each company would share in the Thai tobacco market.
"To secure the sales contracts, each company admitted it paid kickbacks to certain Thailand Tobacco Monopoly representatives based on the number of kilogrammes of tobacco sold to the Thailand Tobacco Monopoly.
"To obtain these contracts, Dimon paid bribes totalling $542,590 and Standard paid bribes totalling $696,160, for a total of $1,238,750 in bribes paid to the Thailand Tobacco Monopoly officials during the course of four years."
Universal admitted paying $697,000 in kickbacks to the monopoly officials, the Justice Department said.
It had agreed to pay a $4.4 million fine and retain an anti-corruption monitor for three years.
Universal Corp said the company voluntarily reported the problems to authorities and that it has cooperated with the investigation.
"We have absolutely no tolerance for this type of activity," chief executive officer George C Freeman III said
BKK Post Published: 8/08/2010 at 12:00 AM
Thailand Tobacco Monopoly officials have been accused of accepting bribes of over US$1.93 million (62 million baht) from US-based companies to ensure Brazilian-grown tobacco was sold locally, says the US Justice Department.
The accusations came after two American tobacco companies agreed on Friday to pay nearly US$30 million to settle charges that they bribed foreign officials to get lucrative overseas tobacco sales contracts.
Local officials could not be reached for comment yesterday.
Universal Corp of Richmond, Virginia, and Alliance One International of Morrisville, North Carolina, face civil and criminal charges from the Securities and Exchange Commission and the Justice Department.
Universal was accused of bribing officials in Thailand, Malawi and Mozambique, while Alliance One was accused of bribing officials in Thailand, China, Greece, Indonesia and Kyrgyzstan.
Alliance One pleaded guilty to three counts of conspiring to violate the US's Foreign Corrupt Practices Act (FCPA).
"The charges relate to bribes paid to Thai government officials to secure contracts with the Thailand Tobacco Monopoly, a Thai government agency, for the sale of tobacco leaf," the Justice Department said.
Alliance One was formed in 2005 from the merger of Dimon Incorporated and Standard Commercial Corporation, two tobacco wholesalers.
It buys, processes and sells tobacco to manufacturers worldwide.
The guilty pleas relate to the conduct of employees and agents of foreign subsidiaries of both Dimon and Standard prior to the 2005 merger, the US Justice Department said.
The department said that it had also filed two counts against Universal Brazil for conspiring to violate the FCPA by paying bribes to Thailand Tobacco Monopoly employees for the sale of Brazilian tobacco.
It didn't say how many Thai officials were involved.
The Justice Department said that from 2000 to 2004, Dimon, Standard and Universal Brazil sold Brazilian tobacco to the Thailand Tobacco Monopoly.
No Thai officials were named by the department.
"Each of the three companies retained sales agents in Thailand, and collaborated through those agents to apportion tobacco sales to the Thailand Tobacco Monopoly among themselves, co-ordinate their sales prices, and pay kickbacks to officials of the Thailand Tobacco Monopoly in order to ensure that each company would share in the Thai tobacco market.
"To secure the sales contracts, each company admitted it paid kickbacks to certain Thailand Tobacco Monopoly representatives based on the number of kilogrammes of tobacco sold to the Thailand Tobacco Monopoly.
"To obtain these contracts, Dimon paid bribes totalling $542,590 and Standard paid bribes totalling $696,160, for a total of $1,238,750 in bribes paid to the Thailand Tobacco Monopoly officials during the course of four years."
Universal admitted paying $697,000 in kickbacks to the monopoly officials, the Justice Department said.
It had agreed to pay a $4.4 million fine and retain an anti-corruption monitor for three years.
Universal Corp said the company voluntarily reported the problems to authorities and that it has cooperated with the investigation.
"We have absolutely no tolerance for this type of activity," chief executive officer George C Freeman III said