General Cable

Cable and wire manufacturer General Cable has agreed to pay more than $75 million to settle charges that it paid bribes of about $19 million to foreign government officials to secure sales in Africa and Asia.

The U.S. Securities and Exchange Commission said the bribes generated illicit profits for General Cable of more than $51 million on sales to state-owned enterprises in Angola, Thailand, China, Indonesia, Bangladesh, and Egypt.

According to a civil complaint filed by the SEC, General Cable subsidiaries made the payments directly to foreign government officials or through third-party agents or distributors. The company’s system of internal accounting controls was not “designed to detect and prevent such corruption and otherwise illegal payments,” the SEC said.

For violating the Foreign Corrupt Practices Act, General Cable agreed to pay more than $55 million to the SEC as well as nearly $20.5 million to resolve a parallel criminal investigation by the Department of Justice.

“General Cable paid bribes to officials in multiple countries in a scheme that involved a high-level executive of the company and resulted in profits of more than $50 million worldwide,” Assistant Attorney General Leslie R. Caldwell said in a news release.

The misconduct allegedly included the payment of more than $9 million in bribes to officials in Angola and $3.9 million in “success fees” to a Thai company.

“The payments were internally referred to as success fees to reflect [General Cable’s] reward to the Thai company for securing business” in Thailand, the SEC said, adding that the company’s local sales director believed the Thai company was paying bribes to officials from the success fees.

Separately, the SEC also fined General Cable $6.5 million for failing to detect improper inventory accounting at its Brazilian subsidiary, causing the company to materially misstate its financial statements from 2008 to the second quarter of 2012.

The commission found no personal misconduct by General Cable’s former CEO Gregory B. Kenny and former CFO Brian J. Robinson, who returned $3.7 million and $2.1 million, respectively, in compensation received from the company during the period when the accounting violations occurred.

, , , , , ,

Leave a Reply

Your email address will not be published. Required fields are marked *