ADM subsidiary agrees to pay fines and plead guilty to violations of Foreign Corrupt Practices Act.
ALFRED C. Toepfer International Ukraine Ltd. (ACTI Ukraine), a Ukrainian subsidiary of Archer Daniels Midland Co. (ADM), pleaded guilty in the central district of Illinois to violating the anti-bribery provisions of the Foreign Corrupt Practices Act and agreed to pay $17.8 million in criminal fines, the U.S. Department of Justice said Dec. 20.
According to the charges, ACTI Ukraine, together with Alfred C. Toepfer International G.m.b.H., also a subsidiary of ADM, paid third-party vendors to pass bribes to Ukrainian government officials to achieve value-added tax refunds from 2002 to 2008.
"As today's guilty plea shows, paying bribes to reap business benefits corrupts markets and undermines the rule of law," acting assistant attorney general Mythili Raman said. "ADM's subsidiaries sought to gain a tax benefit by bribing government officials and then attempted to deliberately conceal their conduct by funneling payments through local vendors. ADM, in turn, failed to implement sufficient policies and procedures to prevent the bribe payments, although, ultimately, ADM disclosed the conduct, cooperated with the government and instituted extensive remedial efforts."
ADM entered into a non-prosecution agreement with DOJ and consented with the U.S. Securities & Exchange Commission to pay $36.5 million in disgorgement and prejudgment interest, bringing the total amount of penalties to $54 million.
ADM chair and chief executive officer Patricia Woertz commented on the process, saying, "In 2008, soon after we became aware of some questionable transactions by a non-U.S. subsidiary, we engaged an outside law firm and an accounting firm to undertake a comprehensive internal investigation.
"In early 2009, we voluntarily disclosed the matter to appropriate U.S. and foreign government agencies and undertook a comprehensive anti-corruption global risk analysis and compliance assessment. We have also implemented internal control enhancements and taken disciplinary action, including termination, with a number of employees," Woertz added.
DOJ acknowledged ADM's cooperation and voluntary disclosure of the action.
In addition to the monetary penalty, ADM and ACTI Ukraine agreed to routinely report compliance efforts and to continue to implement and improve compliance programs to prevent future violations of the Foreign Corrupt Practices Act.