Monsanto Fined $1.5m for Bribery

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Monsanto fined $1.5m for bribery

 

http://news.bbc.co.uk/1/hi/business/4153635.stm

 

Bribes were falsely entered in the books as " consultancy fees "

The US agrochemical giant Monsanto has agreed to pay a $1.5m

(£799,000) fine for bribing an Indonesian official.

Monsanto admitted one of its employees paid the senior official two

years ago in a bid to avoid environmental impact studies being

conducted on its cotton.

 

In addition to the penalty, Monsanto also agreed to three years'

close monitoring of its business practices by the American

authorities.

 

It said it accepted full responsibility for what it called improper

activities.

 

Payout

 

A former senior manager at Monsanto directed an Indonesian consulting

firm to give a $50,000 bribe to a high-level official in Indonesia's

environment ministry in 2002.

 

The manager told the company to disguise an invoice for the bribe as

" consulting fees " .

 

" Companies cannot bribe their way into favourable treatment by

foreign officials. "

- Christopher Wray, assistant US attorney-general

 

Monsanto was facing stiff opposition from activists and farmers who

were campaigning against its plans to introduce genetically-modified

cotton in Indonesia.

 

Despite the bribe, the official did not authorise the waiving of the

environmental study requirement.

 

Monsanto also has admitted to paying bribes to a number of other

high-ranking officials between 1997 and 2002.

 

'Full responsibility'

 

The chemicals-and-crops firm said it became aware of irregularities

at a Jakarta-based subsidiary in 2001 and launched an internal

investigation before informing the US Department of Justice and the

Securities and Exchange Commission (SEC).

 

Monsanto faced both criminal and civil charges from the Department of

Justice and the SEC.

 

" Companies cannot bribe their way into favourable treatment by

foreign officials, " said Christopher Wray, assistant US attorney

general.

 

Monsanto has agreed to pay $1m to the Department of Justice, adopt

internal compliance measures, and co-operate with continuing civil

and criminal investigations.

 

It is also paying $500,000 to the SEC to settle the bribe charge and

other related violations.

 

Monsanto said it accepted full responsibility for its employees'

actions, adding that it had taken " remedial actions to address the

activities in Indonesia " and had been " fully co-operative " throughout

the investigative process.

 

= = = = =

 

Monsanto Settles with U.S. Over Indonesia Bribe

Fri Jan 7, 2005 12:10 AM ET

 

http://www.reuters.com/newsArticle.jhtml?

type=worldNews & storyID=7261608

 

NEW YORK (Reuters) - Monsanto Co. on Thursday said it agreed to pay

$1.5 million in penalties to settle U.S. criminal and civil charges

for bribing an Indonesian government official and concealing the

payment as consulting fees.

The agrochemical company said it accepted full responsibility for the

improper activities and regretted that people working on behalf of

Monsanto engaged in such behavior.

 

The settlements were reached with the Department of Justice and the

Securities and Exchange Commission.

 

The Justice Department said Monsanto was charged with violating the

Foreign Corrupt Practices Act for making an illegal payment of

$50,000 to a senior official in Indonesia's Ministry of the

Environment in 2002 and falsely certifying the bribe as " consultant

fees " on the company's books and records.

 

Monsanto agreed to pay a $1 million penalty, adopt internal

compliance measures, and cooperate with continuing criminal and civil

investigations.

 

An " independent compliance expert " will audit and keep watch on

Monsanto's compliance program, the Justice Department said in a

statement.

 

The St. Louis-based company also agreed to pay a $500,000 civil

penalty to settle SEC charges for the $50,000 bribe and related

violations.

 

The SEC charges also included at least $700,000 of " illegal or

questionable payments made to at least 140 current or former

Indonesian government officials and their family members, " the SEC

said.

 

Some of the payments were for buying land and building a house in the

name of the wife of a senior Ministry of Agriculture official, the

SEC said.

 

" Companies cannot bribe their way into favorable treatment by foreign

officials, " said Christopher Wray, an assistant U.S. Attorney

General.

 

A former U.S.-based Monsanto senior manager directed an Indonesian

consulting firm to make the $50,000 bribe to a senior official in the

Ministry of the Environment to get him to repeal a requirement for an

environmental impact study the company needed before it could

cultivate genetically modified crops, the Justice Department said.

 

The Monsanto manager also ordered the Indonesian consultants to

submit false invoices for " consultant fees " to get reimbursed for the

bribe money. The manager also agreed to pay the consulting firm's

taxes on income from the phony fees, according to the department.

 

The cash bribe was delivered to the government official in February

2002 and Monsanto, through its Indonesian subsidiary, paid the false

invoices the next month and a false entry for the " consulting

services " was included in Monsanto's books and records, the

department said.

 

The Indonesian official, however, did not authorize repeal of the

environmental study requirement.

 

Monsanto stock was up 4.7 percent at $53.39 in late trading on the

New York Stock Exchange on Thursday.

 

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