FCPA whistleblowers who report companies that pay bribes to officials working at state-owned entities (“SOEs”) may be eligible for a reward under the Dodd-Frank program. SEC-regulated companies and their subsidiaries and affiliates will often bribe officials working at SOEs in order to obtain tenders and deals.
In many instances, companies will provide trips to procurement officials at SOEs under the guise of “factory inspection” or “demonstration” visits. During these “due diligence” trips, SOE officials are often provided “pocket money” and the opportunity to engage in touristy activities. Sometimes these officials will be provided side trips where they can engage in sightseeing. In return for these trips, the SOE officials will ensure the company receives the tender.
Companies also will use third parties to provide kickbacks to SOE officials who are responsible for evaluating the tender process. Sometimes channel partners and consultants will obtain significant discounts from SEC-regulated companies and use those discounts to create a large margin whereby they can provide kickbacks to SOE officials in return for the tenders. Relatedly, companies also will engage third-party consultants who are either related or someway affiliated with SOE officials. In return for hiring a relative or engaging an affiliated entity as a vendor, the SOE officials will ensure the company win the tender.
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Anyone who has knowledge of an SEC-regulated company (or an affiliate, partner, or subsidiary thereof) bribing employees working at an SOE entity should feel free to contact me for a free confidential case assessment, as this could be very valuable information. For more information and details about how FCPA whistleblowers can obtain rewards under the SEC’s program, please click here.