WASHINGTON (Legal Newsline) – The Securities and Exchange Commission (SEC) announced Dec. 21 that Braskem S.A., a Brazil-based petrochemical manufacturer whose stock trades in the U.S. markets, agreed to settle allegations of creating false books and records.
According to the SEC, the company used these false records to conceal millions of dollars worth of illicit bribes paid to Brazilian government officials to win or retain business. Braskem purportedly made $325 million in profits through bribes to a government official at Brazil’s state-controlled petroleum company.
“As alleged in our complaint, Braskem lacked the internal controls to prevent its use of third parties, off-book accounts, and other intermediaries to bribe government officials in Brazil during an eight-year period,” said Stephanie Avakian, deputy director of the SEC Enforcement Division. “Braskem’s misconduct was exposed through the investigative work of authorities in three countries.”
To settle the charges, Braskem agreed to a $957 million penalty. This includes $325 million in disgorgement - $65 million to the SEC and $260 million to Brazilian authorities.
Handling the case for the SEC are Ernesto Palacios and Thierry Olivier Desmet of the FCPA Unit, with assistance from David S. Johnson and Fernando Torres.