The Securities and Exchange Commission on Wednesday charged BHP
Billiton Ltd. with violating the Foreign Corrupt Practices Act in
connection with the company's sponsorship of the 2008 Summer
Olympic Games.
The Australia-based mining company agreed to pay $25 million to
settle the charges.
A BHP representative couldn't immediately be reached for
comment.
According to the SEC, BHP invited 176 government officials and
employees of state-owned enterprises, plus 60 guests, to attend the
games in Beijing at the company's expense. The sponsored guests
were primarily from countries in Africa and Asia and received
hospitality packages, which included event tickets and hotel
accommodations, that were valued at $12,000 to $16,000 a package,
the commission said.
"BHP Billiton footed the bill for foreign government officials
to attend the Olympics while they were in a position to help the
company with its business or regulatory endeavors," said Andrew
Ceresney, an SEC director. "BHP Billiton recognized that inviting
government officials to the Olympics created a heightened risk of
violating anticorruption laws, yet the company failed to implement
sufficient internal controls to address that heightened risk," Mr.
Ceresney said.
While the company required business managers to complete a
hospitality application form for any individuals they sought to
invite to the Olympics, the SEC alleges that BHP failed to provide
employees with any specific training on how to complete forms or
evaluate bribery risks of the invitations. BHP didn't implement
procedures to ensure meaningful preparation, review and approval,
the commission said.
As a result, according to the SEC, a number of the hospitality
applications were inaccurate or incomplete, and BHP extended
Olympic invitations to government officials connected to pending
contract negotiations or regulatory dealings such as the company's
efforts to obtain access rights.
The company neither admitted nor denied the SEC's findings,
according to the commission. The settlement requires BHP to report
to the SEC on the operation of its FCPA compliance program for a
one-year period.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
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