Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week, Purdue Pharma pays USD 8BN in a settlement for violation to federal anti-kickback laws. Keep reading for this breaking story and find more news below:
Purdue Pharma Pays USD 8BN in Settlement:
Opioid giant Purdue Pharma settled charges with the U.S. Department of Justice (DOJ) for USD 8.3BN for violating anti-kickback rules and not taking the necessary preventive measures to prevent its drugs from being sold illegally. The company entered a guilty plea by admitting to having paid doctors to speak at events as a means to promote its Oxycontin drug and boost the number of prescriptions, breaching the federal Anti-Kickback Statute. The pharma giant also admitted to not having taken necessary precautions to prevent the illegal distribution of opioids. It is reported that the company filed for bankruptcy last year.
Whiskey Maker Settles FCPA Probe for USD 19M:
Spirit manufacturer Jim Bean settled FCPA charges with U.S. authorities for USD 19.5M. According to the DOJ, Beam's Indian branch used third parties to pay bribes to Indian public officials to gain business in the Indian market from 2006 to 2012. The company reportedly concealed the bribes in their accounting systems and failed to incorporate proper internal control systems violating the FCPA's book-keeping provisions.
World Bank Debars Chinese Companies:
The World Bank Group (WB) announced sanctions against state-owned China National Electric Engineering Company Limited (CNEEC) and its subsidiary China Electric Design and Research Institute Company Limited (CEDRI) for fraud in Zambia. The construction and engineering company was undertaking a USD 210M electricity infrastructure project in Zambia meant to increase electricity reliability in the country. According to the World Bank, the Beijing-based parent company failed to oversee its subsidiary, which submitted false documents to meet contract requirements and did not disclose a conflict of interest. The subsidiary, CEDRI is barred from entering any new WB-financed projects for the next 18 months. CNEEC was sanctioned with conditional non-debarment and is allowed to enter World Bank-financed projects as long as it fulfills the terms of the settlement. Both companies agreed to develop a compliance program according to the World Bank Group Integrity Compliance Guidelines.
EU Parliament Gives Recognition to Three Whistleblowers:
A group in the European Parliament gave three recognitions to whistleblowers for 'exposing the truth and for their courage in risking their careers and personal freedom.' One of the awards was given to the whistleblowers in the Novartis case, who were recognized for having exposed high-level corruption by the pharma giant and Greek public officials. Additionally, Correctiv, a group of EU investigators that helped expose the 'cum-ex' tax evasion scandal, and Chelsea Manning, an American whistleblower on human rights violations in the U.S. Army, were also given recognition.
U.K. SFO Lays Out Compliance Expectations in New DPA Guidance:
On October 23rd, the U.K. Serious Fraud Office (SFO) released a new chapter on its handbook detailing the threshold companies must meet before being offered a Deferred Prosecution Agreement (DPA). The guide lists compliance programs as a relevant public interest factor in considering whether a DPA, as opposed to prosecution, is in the public interest of the prosecutor. Among other things, the document states that the SFO may scrutinize whether the firm's compliance program was effective during the time of the offense. The guide also underlines that compliance programs should be 'proportionate, risk-based, and regularly tested' and points to the use of data analytics as a potential tool to test compliance behavior. Additionally, the outlined DPA agreement terms include a commitment to ensuring improvements in compliance programs as well as the possibility of setting up external compliance monitors.
Ukraine's Top Court Strips Anti-Corruption Agency of Critical Powers:
Ukraine's Constitutional Court published a ruling stripping the country's anti-corruption agency of some of its most critical prosecution powers. Among other things, the court deprived the agency of the authority to carry out anti-corruption inspections in government agencies. The court's decision, which cannot be appealed, also denies the agency the powers to verify signs of corruption in the lifestyles of public officials and denies the agency access to registers and draft reports on violations.
Greece's Top Anti-Corruption Body Faces Threat of Removal:
Greece's Ministry of Justice introduced a new bill to parliament that would abolish Greece's top-anti prosecutor's office. The bill proposes to merge the anti-corruption prosecutor's office with the financial crime unit to form one single Financial Crime Department. If passed, the bill would automatically depose one of Greece's most prominent anti-corruption figures, Eleni Touloupaki, who has been running a prolonged investigation into several members of the incumbent political party. Touloupaki is also investigating whether pharma Giant Novartis bribed Greek officials to boost prescription sales at inflated prices.
DOJ issues further guidance, warnings on ephemeral messaging apps
Federal appeals court upholds 5.6B USD Visa and Mastercard settlement
The DOJ updates its guidance on corporate compliance programs