Bank of NY Mellon to Pay $14.8 Million to Settle FCPA Probe
August 18 2015 - 12:57PM
Dow Jones News
By Lisa Beilfuss
Bank of New York Mellon Corp. agreed to pay $14.8 million to
settle charges that it violated the Foreign Corrupt Practices Act
by providing internships to family members of foreign government
officials with ties to a Middle Eastern sovereign-wealth fund.
According to the Securities and Exchange Commission, the bank
provided student internships to family members of the officials to
influence those officials and win or retain contracts to manage and
service the assets of the fund.
BNY Mellon provided the internships without following its
standard hiring procedures for interns, and the interns weren't
qualified for the bank's existing internship programs, the SEC
said.
"The FCPA prohibits companies from improperly influencing
foreign officials with anything of value," including "valuable
student internships," said SEC enforcement official Andrew
Ceresney.
The company did have an FCPA compliance policy but maintained
few specific controls around the hiring of customers and relatives
of customers, according to the SEC. BNY Mellon's system of internal
accounting controls was insufficiently tailored to the corruption
risks inherent in the hiring of client referrals, and therefore was
inadequate to fully effectuate BNY Mellon's stated policy against
bribery of foreign officials, the agency added.
In settling the charges, the bank didn't admit or deny
wrongdoing.
"We are pleased to reach an agreement with the SEC that allows
us to put this matter behind us," the bank said, adding it had
already taken steps to enhance existing internal controls and
procedures surrounding internship and hiring practices.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 18, 2015 12:42 ET (16:42 GMT)
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