Risk Management

Settlement in Monsanto Bribery Case

The company's former government affairs director for Asia bribed an Indonesian environmental official in 2002.
Dave Cook and Stephen TaubMarch 7, 2007

A former employee of agribusiness giant Monsanto has settled charges brought by the Securities and Exchange Commission for the bribery of an Indonesian official.

The SEC complaint alleged that in 2002, Charles Martin, once Monsanto’s government affairs director for Asia, violated the Foreign Corrupt Practices Act by directing a local consulting firm to pay $50,000 to a senior official of Indonesia’s Ministry of Environment. The payment was intended to encourage the repeal of language in a decree that would otherwise compel Monsanto to undertake an environmental study.

To raise the $50,000 and conceal the activity, the commission elaborated, Martin directed the consulting firm to create a set of false invoices, which he approved and had processed, circumventing Monsanto’s system of internal accounting controls.

Without admitting or denying the SEC allegations, Martin agreed to pay a civil penalty of $30,000 and consented to a permanent injunction against further violations.

In 2005, Monsanto, which voluntarily disclosed the $50,000 payment, was fined $1.5 million by the SEC.

As for the results of the bribe, even though Martin’s scheme was carried out and the $50,000 payment was made to the Indonesian official, noted the commission, the unfavorable decree remained in effect.

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