In an SEC filing last week, spirits-maker Beam Inc. confirmed that it is investigating possible FCPA violations by its India unit.
Last month, the press in India said Illinois-based Beam was forced to start an investigation after whistleblower complaints about ‘excise duty violations, invoicing problems, and handing over distribution in some key markets.’
Beam Inc.’s full disclosure appeared in its quarterly report (Form 10-Q) filed with the SEC on November 8.
The disclosure said:
As a result of information obtained through our internal compliance procedures and an internal audit of our India business, we commenced an investigation into whether the business has been conducted in compliance with Company policies and applicable law, including the Foreign Corrupt Practices Act. We have voluntarily notified the U.S. Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) of our investigation and intend to cooperate fully with the DOJ and SEC. We are presently unable to predict the duration, scope or result of the internal investigation or of any potential investigations by the DOJ or the SEC. At this time, we also cannot reasonably estimate the potential liabilities that may result from this matter, and no accruals for these potential liabilities have been established as of September 30, 2012. However, it is reasonably possible that such liabilities could have a material impact on our results of operations, cash flows or financial condition. In addition, the ongoing conduct of the investigation and our implementation of remedial measures are likely to have a disruptive effect on our India business over the near term.
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