Consumer Packaged Goods Industry
The Consumer Packaged Goods Industry accounts for roughly two-thirds of the world’s trade by volume and is a significant contributor to the GDP of many countries. In recent decades, companies in the industry have made substantial investments in a broadening array of countries by building factories, establishing supply chains and organizing distribution networks. To increase operating efficiencies, many companies have formed mergers, acquisitions, joint ventures and alliances with foreign partners.
As companies in the industry source input commodities and distribute finished products in an expanding array of foreign markets, navigating the maze of local regulations becomes a time-consuming, expensive proposition. In these circumstances, the risk of falling out of compliance with the Foreign Corrupt Practices Act (FCPA) or the U.K. Bribery Act grows exponentially.
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|Company: ||Tyson Foods, Inc. |
|Charges: ||Bribing government officials |
|Penalty: || |
Arkansas-based Tyson Foods, Inc. is one of the world's largest processors and marketers of chicken, beef and pork, as well as prepared foods. Founded in 1935, the company provides products and services to customers throughout the U.S. and in more than 90 other countries.
On February 10, 2011, Tyson Foods was charged with violating the FCPA by making illegal payments to two Mexican government veterinarians. The veterinarians were responsible for certifying the chicken products of the company’s Mexican subsidiary for export sales.
Tyson hid $100,331 in improper payments by putting the veterinarians’ non-working wives on its payroll. Later, the wives were removed from the payroll and invoices for “services” were paid to the officials.
“Tyson and its subsidiary committed core FCPA violations by bribing government officials through no-show jobs and phony invoices, and by having a lax system of internal controls that failed to detect or prevent the misconduct,” stated Robert Khuzami, Director of the SEC’s Division of Enforcement.
In order to settle SEC charges and resolve related criminal proceedings, Tyson Foods agreed to pay more than $5 million in fines.
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