Brazil's J&F To Pay $256 Mln, Its Unit JBS SA To Pay $27 Mln In FCPA Violations

(RTTNews) - Brazilian meat and protein major JBS SA, its parent J&F Investimentos S.A. as well as their owners Joesley Batista and Wesley Batista have agreed to pay fines related to violations of the U.S. Government's Foreign Corrupt Practices Act or FCPA.

In order to resolve bribery charges, J&F agreed with the U.S. Department of Justice to pay a criminal monetary penalty of $256.50 million, while JBS agreed with the Securities and Exchange Commission to pay approximately $27 million.

In a statement, the U.S. Department of Justice noted that J&F, a Brazilian investment company, pleaded guilty to charges related to its scheme to pay millions of dollars in bribes to government officials in Brazil for obtaining financing and other benefits for J&F and J&F-owned entities.

According to admissions by J&F, between 2005 and 2017, the company conspired with others and paid bribes to government officials.

For a three-year period, J&F agreed to continue to cooperate with the U.S. government in any ongoing or future criminal investigations concerning J&F, its executives, employees, or agents.

In a related development, the U.S. Securities and Exchange Commission or SEC said JBS agreed to pay approximately $27 million and the Batistas each agreed to pay a civil penalty of $550,000. The fine would resolve charges related to an extensive bribery scheme that took place over multiple years to facilitate JBS's 2009 acquisition of U.S. issuer Pilgrim's Pride Corp.

As per the order, the Batistas, following the acquisition and while serving as board members of Pilgrim's, made payments of around $150 million in bribes at the direction of a former Brazil Finance Minister. The Batistas also exerted significant control over Pilgrim's, and caused the failure of Pilgrim's to maintain an adequate system of internal accounting controls and accurate books and records.

The SEC noted that Joesley Batista, Wesley Batista, J&F, and JBS consented to the SEC's order finding that they caused Pilgrim's Pride's violations of the books and records and internal accounting controls provisions of the FCPA and agreed to cease-and-desist orders.

The parties must also comply with a three-year undertaking to self-report on the status of certain remedial measures.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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