Ralph Lauren has agreed to pay $1.6 million to resolve regulatory and criminal claims that executives at its Argentinian subsidiary bribed government officials.
The agreement will settle allegations that the manager of the clothing firm’s Argentinian subsidiary bribed customs officials for five years to ensure the clearance of prohibited goods, avoid inspections and to import certain items without the necessary paperwork.
The employee disguised $593,000 worth of bribes by funnelling them through a customs clearance agency, which created fake invoices to justify the improper payments.
The company will pay $882,000 to resolve allegations that it violated the Foreign Corrupt Practices Act (FCPA), and a further $734,846 to the US Securities and Exchange Commission (SEC) in a non-prosecution agreement (NPA) in disgorgement and prejudgement interest.
The US Department of Justice said that during the five year period, Ralph Lauren did not have an anti-corruption agency program and did not provide any anti-corruption training or oversight at its Argentinian subsidiary.
“When they found a problem, Ralph Lauren Corporation did the right thing by immediately reporting it to the SEC and providing exceptional assistance in our investigation,” said George Canellos, acting director of the SEC’s Division of Enforcement.
“The NPA in this matter makes clear that we will confer substantial and tangible benefits on companies that respond appropriately to violations and cooperate fully with the SEC.”
The company has also agreed to co-operate with the Department of Justice to report periodically on its compliance efforts, as well as continuing to implement an enhanced compliance programme and internal controls to prevent and detect FCPA violations.
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