J&J Avoids Bribery Trouble by Paying Federal Gov
Submitted by
Lois Rain on April 14, 2011
This week the Securities and Exchange Commission (SEC) charged Johnson and Johnson (J&J) for violating the Foreign Corrupt Practices Act (FCPA) after it was discovered that J&J bribed doctors in several European countries and paid kickbacks to Iraq for business under the UN Oil for Food Program. At the same time, the Justice Department (DOJ) charged them with parallel crimes. J&J is agreeing to settle the conflict with around $70
million; about $21 million penalty to the DOJ and over $48 million
to the SEC in disgorgement of profits, including pre-judgment
interest. The charges and fines are milder due to their cooperation
with investigators. So, there’s the resolution. Corrupt bribes and kickbacks to
foreign officials and doctors will cost a drop in the bucket, and
companies like J&J can carry out their influence. Meanwhile, the
federal government won’t really bust them, they just want some of
the loot. Some doctors can continue prescribing to patients based on
the highest bidding supplier. Now Johnson & Johnson can write a book: How to Betray America, Keep Profits, and Stay Out of Trouble. ~Health Freedoms
Johnson & Johnson fined for bribing doctorsWASHINGTON — US authorities fined cosmetics and drugs giant Johnson & Johnson $70 million on Friday for bribing doctors in Europe and paying kickbacks for contracts under a UN relief program in Iraq. The Department of Justice and Securities and Exchange Commission said since 1998 the firm had paid doctors and hospital administrators in Greece, Poland and Romania for contracts and to promote its drugs and medical devices. Johnson & Johnson also paid kickbacks between 2000-2003 for 19 contracts under the UN Oil for Food Program, which provided humanitarian supplies to Iraqis while the country, still ruled by Saddam Hussein. The firm, the 15th largest US company by market capitalization, agreed to pay US authorities $70 million to settle the charges, including $48.6 million to the SEC and $21.4 million to the Justice Department. US prosecutor Mythili Raman that the company had “cooperated extensively” with the investigation. “The message … is plain — any competitive advantage gained through corruption is a mirage,” said SEC enforcement director Robert Khuzami. “J&J chose profit margins over compliance with the law by acquiring a private company for the purpose of paying bribes, and using sham contracts, offshore companies, and slush funds to cover its tracks.” The charges detailed that J&J subsidiaries Cilag AG International and Janssen Pharaceutica made $858,000 dollars in payoffs to Saddam Hussein’s government to win $9.0 million in contracts under the deeply corrupted Oil for Food Program. “The kickbacks were concealed from the United Nations by inflating Janssen and Cilag’s contract prices by 10 percent,” they said. The SEC said J&J was under a related investigation by Britain’s Serious Fraud Office and that a resolution was also expected. By Agence France-Presse Sources: http://www.rawstory.com/rs/2011/04/08/johnson-johnson-fined-for-bribing-doctors/ http://www.sec.gov/litigation/complaints/2011/comp21922.pdf http://washingtondc.fbi.gov/dojpressrel/pressrel11/wfo040811a.htm Health Freedom Alliance |