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Diageo To Settle With SEC In Bribery Case

June 10, 2011

Diageo has agreed to pay between $10 million and $20 million to settle a bribery investigation conducted by the U.S. Securities and Exchange Commission related to its businesses in South Korea, India and Thailand, according to a report in the Financial Times citing unnamed sources. A Diageo spokesperson told Shanken News Daily today the company wasn’t at liberty to comment on the ongoing SEC inquiry.

According to the FT, settlement talks are at an advanced stage in a probe into Diageo employees’ or contractors’ payments to government officials in those Asian markets. Diageo regulatory filings show the company disclosed such payments to the U.S. Justice Department and SEC and was pursuing an internal investigation regarding possible improper activities in India, Thailand, Korea and elsewhere.

The SEC investigation was spurred by a 2007 customs fraud case brought by South Korean authorities that resulted in Diageo temporarily losing its import license in the country. Diageo India has also seen upheaval in recent years, with former top executive Asif Adil departing in 2009 under a cloud of local press reports that he’d overseen inventory mismanagement, inflated promotional expenses and undertaken other such practices before being replaced by current managing director Roland Abella.

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