March 24, 2008
Glenn R. Simpson, of the Wall Street Journal, has an article this morning titled, "U.S. Opens Alcoa Bribery Probe." Alcoa, a global company, clearly has internal rules related to the giving and taking of company gifts. For example, one finds this one on the company website:
"Gifts, favors and entertainment may be given at company expense or accepted by directors, officers or employees from a competitor or an individual or firm doing or seeking to do business with the company only if they meet all of the following criteria:
- they are consistent with customary business practices and do not violate applicable law or ethical standards;
- they are not excessive in value;
- they cannot be construed as a bribe, payoff or improper inducement; and
- public disclosure of the facts would not embarrass the company or the director, officer or employee.
Payments or gifts of cash (or of cash equivalents such as stocks or commodities) to or from a competitor or an individual or firm doing or seeking to do business with the company are never permitted and may not be solicited, offered, made or accepted by directors, officers or employees"
Although a big believer in the presumption of innocence, one has to wonder what could happen if this investigation turns up a bribe to a foreign official. The Foreign Corrupt Practices Act is easily explained in this DOJ Layperson's Guide discussed here. But one notices in looking at the results of a good number of cases (see here) against companies, that if the DOJ does decide to proceed, there is little likelihood of a trial. When a company is involved, the matter tends to end with a payment of a fine and in some cases a deferred prosecution agreement. In a post-Arthur Andersen world, this is easily explained as the cost of fighting can be a death sentence to a company. If the government does find something here, one has to wonder if this will be the result. But, on the other hand, if there is nothing to this investigation - it is hoped that the press received will not hurt the company.
TrackBack URL for this entry:
Listed below are links to weblogs that reference Alcoa Investigation: