SEC Charges Brazilian Meat Producers With FCPA Violations

 

Mondo Visione (UK)

14/10/2020

 

The Securities and Exchange Commission today announced that Brazilian nationals Joesley Batista and Wesley Batista and their companies J&F Investimentos S.A. and JBS S.A., a global meat and protein producer, have agreed to pay nearly $27 million to resolve charges arising out of an extensive bribery scheme that took place over multiple years.

 

The SECís order finds that the Batistas engaged in a bribery scheme in part to facilitate JBSís 2009 acquisition of U.S. issuer Pilgrimís Pride Corporation.† According to the order, following that acquisition and while serving as board members of Pilgrimís, the Batistas made payments of approximately $150 million in bribes at the direction of a former Brazil Finance Minister using in part funds from intercompany transfers, dividend payments, and other means obtained from JBS operating accounts containing funds from Pilgrimís.† As set forth in the order, the Batistas exerted significant control over Pilgrimís, which shared office space, overlapping board members and executives, accounting and SAP systems, and certain internal accounting controls and policy documents with JBS and its U.S. affiliate JBS USA.† The order finds that as a result of that control, the Batistas caused the failure of Pilgrimís to maintain an adequate system of internal accounting controls and accurate books and records.† The order also finds that the Batistas, who signed Pilgrimís Prideís financial statements, did not disclose their conduct to Pilgrimís Prideís accountants and independent public accountants.

 

ďEngaging in bribery to finance their expansion into the U.S. markets and then continuing to engage in bribery while occupying senior board positions at Pilgrimís reflects a profound failure to exercise good corporate governance,Ē said Charles Cain, Chief of the SEC Enforcement Divisionís FCPA Unit. ďThis brazen misconduct flies in the face of what investors should expect from those occupying the role of an officer or director of a U.S. issuer.Ē

 

Joesley Batista, Wesley Batista, J&F, and JBS consented to the SECís order finding that they caused Pilgrimís Prideís violations of the books and records and internal accounting controls provisions of the FCPA and agreed to cease-and-desist orders.† Further, JBS agreed to pay approximately $27 million...

 

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UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

 

SECURITIES EXCHANGE ACT OF 1934

Release No.90170/ October 14, 2020

 

ACCOUNTING AND AUDITING ENFORCEMENT

Release No.4189 / October 14, 2020

 

ADMINISTRATIVE PROCEEDING

File No. 3-20124

 

Document (pdf):

https://www.sec.gov/litigation/admin/2020/34-90170.pdf