February 13, 2012
Ding Dong, Grand Jury Calling.
Today's WSJ reports here, in an article by Joe Palazzolo and Emily Glazer, that Avon is facing a DOJ and federal grand jury invesitgation of FCPA allegations. It is unclear who leaked the grand jury aspect of the case, but Avon does not deny that there is an investigation and you can't run a federal FCPA probe without a grand jury. According to the article, an internal 2005 audit report revealed questionable payments to Chinese officials and third parties, but the report wasn't shared with the audit committee, the full Board of Directors, or the finance committee. The article gives no details on the 2005 internal audit report. Avon apparently launched a full fledged internal investigation, but not until 2008. No discussion in the article of any potential statute of limitation issues.
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