Brazilian Meat Producers Settle SEC And DOJ FCPA Charges

• Published date: 27 October 2020
• Subject Matter: Corporate/Commercial Law, Corporate and Company Law, Securities
• Law Firm: Cadwalader, Wickersham & Taft LLP
• Author: Mr Kyle DeYoung

Two Brazilian nationals (the "individuals") and their companies, a global meat producer and its parent company, settled SEC and DOJ charges of violations under the Foreign Corrupt Practices Act ("FCPA").

As described in the Order, the SEC found that the individuals made illicit payments "totaling approximately $150 million for the benefit of then Brazil Finance Minister ("Minister") and various political parties and candidates in Brazil at the request and direction of the Minister." The Minister, in turn helped the individuals access equity financing to facilitate an acquisition of a U.S. corporation ("the acquired corporation"). The SEC found that the individuals and their companies continued the bribery scheme after the acquisition - unbeknownst to the acquired corporation's management - and commingled their funds with those of the acquired corporation. As a result, the SEC determined that the acquired corporation violated the books, records and internal accounting provisions of the FCPA.

To settle the SEC's charges, the individuals agreed to (i) each pay a $550,000 civil penalty and (ii) cease and desist from future violations of Section 13(b)(5) of the Exchange Act and Rules 13b2-1 and 13b2-2 thereunder. The meat producer agreed to pay a disgorgement of nearly $27 million. Additionally, the individuals...