World’s Largest Mining Company Investigated for Corruption
BHP Billiton, the world’s largest mining company, is under investigation for alleged corrupt practices leading up to the 2008 Beijing Olympics, the New York Times reported Wednesday. BHP is accused of providing inducements and gifts to Chinese government officials and executives in the steel industry in an attempt to gain an unfair, and illegal, business advantage. If the mining giant is found to have broken corrupt practices laws, it could face hefty fines in the United States, up to twice the estimated financial cost or gain from any corrupt practices.
BHP said it was “cooperating with the relevant authorities” on the matter and that the company did not believe any laws had been broken, adding that the company’s “policies specifically prohibit engaging in bribery in all its forms.” A continuation of a 2009 internal investigation into the possibility of corruption is also underway at BHP, according to Bloomberg.
If BHP pays a Foreign Corrupt Practices Act (FCPA) settlement, it will not be the first large multinational corporation to part with a large amount of money: Allianz SE, a German insurance company, was charged with failing to stop a subsidiary from paying out bribes to employees of state-owned entities in Indonesia. The German corporation paid the US Securities and Exchange Commission $12.3 million. Tyco Electronics was accused of participating in a scheme whereby bribes hidden as commissions were paid in order to win lucrative contracts. Tyco settled for $26 million. Pfizer, along with a recently acquired company, Wyeth LLC, was charged with separate violations of the FCPA, and paid a combined total of $45 million to settle their respective cases.
Corporate entity settlements exceeded $100 million in 2012, according to the US Securities and Exchange Commission.