The corruption cases databases are a product of the staff of the International Bank for Reconstruction and Development / The World Bank. It is intended for general information purposes only. The findings, interpretations, and conclusions expressed in the Database do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. Neither the World Bank Group nor its officers or employees shall be liable for any losses that may result directly or indirectly from the use of or reliance upon such information.
Securities and Exchange Commission
Thailand, India, South Korea
Consent to Cease-and-Desist Order
Disgorgement of Profits, Prejudgment Interest, Civil Penalty
Internal controls violations, Falsification of books and records
No admission or denial of allegations
No (Customs, Tax)
According to a US Securities and Exchange Commission Press Release, "According to the SEC's order instituting settled administrative proceedings against Diageo, the company made more than $1.7 million in illicit payments to hundreds of government officials in India from 2003 to mid-2009. The officials were responsible for purchasing or authorizing the sale of its beverages in India, and increased sales from these payments yielded more than $11 million in profit for the company. The SEC found that from 2004 to mid-2008, Diageo paid approximately $12,000 per month -- totaling nearly $600,000 -- to retain the consulting services of a Thai government and political party official. This official lobbied other high-ranking Thai government officials extensively on Diageo?s behalf in connection with pending multi-million dollar tax and customs disputes, contributing to Diageo's receipt of certain favorable decisions by the Thai government. According to the SEC's order, Diageo paid 100 million in Korean currency (more than $86,000 in U.S. dollars) to a customs official in South Korea as a reward for his role in the government's decision to grant Diageo significant tax rebates. Diageo also improperly paid travel and entertainment expenses for South Korean customs and other government officials involved in these tax negotiations. Separately, Diageo routinely made hundreds of gift payments to South Korean military officials in order to obtain and retain liquor business. [ ] Without admitting or denying the findings, Diageo agreed to cease and desist from further violations and pay $11,306,081 in disgorgement, prejudgment interest of $2,067,739, and a financial penalty of $3 million." (Source: US Securities and Exchange Commission Press Release, "SEC Charges Liquor Giant Diageo with FCPA Violations," July 27, 2011.)
US Securities and Exchange Commission Press Release, "SEC Charges Liquor Giant Diageo with FCPA Violations," July 27, 2011, accessed at http://www.sec.gov/news/press/2011/2011-158.htm; In the Matter of Diageo plc, SEC Administrative Proceeding File No. 3-14490, "Order Instituting Cease-and-Desist Proceedings," July 27, 2011, accessed at http://www.sec.gov/litigation/admin/2011/34-64978.pdf
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