FCPAméricas Blog
Polo Pulls Out of Argentina … after Ralph Lauren Corp. Violates FCPA at Argentine Customs
4.23.2013
Argentines certainly value their sense of style. Unfortunately, however, they just lost official retail access to the Polo brand. Ralph Lauren Corporation has decided to wind down its operations in the country.
Yesterday’s FCPA settlement with the Ralph Lauren Corporation suggests that the company’s decision to pull out might be linked, at least in part, to the high corruption risks associated with operating in Argentina. Based on bribes the company’s subsidiary paid to customs and other officials, the DOJ and SEC just reached FCPA non-prosecution agreements (NPAs) with the company. The settlement carries more than $1.6 million in fines and penalties combined. Other notable features of this FCPA enforcement action include:
Customs Risks. In an internal investigation, Ralph Lauren found that the manager of its Argentine subsidiary, a dual citizen of the United States and Argentina, bribed customs officials over the span of five years. Such activity, in fact, is not so uncommon in Argentina. Earlier this month, FCPAméricas highlighted... Read more
Considering Cultural Nuance in Your Latin American FCPA Hotline
4.17.2013
Internal reporting mechanisms – like confidential hotlines – offer employees an anonymous way to report potential anti-corruption violations. Such mechanisms have become standard components of FCPA compliance programs. However, companies implementing such mechanisms need to consider a number of implementation issues, ranging from what technology should be used, how to educate employees on internal reporting, and how to handle reports when they come in.
Companies should also be sure to consider culture when implementing internal reporting mechanisms. In order to make them effective, reporting mechanisms need to be sensitive to local cultures. The following are five ways that companies are adapting their internal reporting programs to Latin American audiences.
1. Use the Local Language. To make hotlines and other reporting mechanisms credible, companies should present them in local languages with local idioms. Training materials should clearly be prepared in the main local language: i.e., Spanish, Portuguese, or French for most of Latin America. Depending on your business, it might also make sense to prepare materials in Quechua or other local dialects. Companies should also take into account that languages diffe... Read more
Managing Latin America FCPA Risks at Customs
4.12.2013
The agricultural trade press reports that Brazilian ports have a 60-day backlog of soybean shipments – about twice the usual delay – due to a record soybean crop. In Argentina, labor unrest has created shipping delays for agricultural commodities. Delays like these increase corruption risks – they create conditions for customs agents to pressure companies for illicit payments, and they heighten the temptation for companies to look for creative ways around bottlenecks.
Indeed, bribing customs officials is a common FCPA enforcement scenario in Latin America. Cases like Ball Corporation in Argentina, Helmerich & Payne in Argentina and Venezuela, and American Rice in Haiti highlight the potential problems associate with moving goods in ... Read more
