The US Securities and Exchange Commission has announced charges against Stericycle Inc. for violations of the Foreign Corrupt Practices Act arising out of bribery schemes that took place in Argentina, Brazil, and Mexico.
The company has agreed to pay over $84m to settle civil and criminal charges related to these schemes, including c.$28m to settle the SEC’s charges.
The SEC’s order finds that Stericycle, a leading provider of medical waste and other services in 16 countries worldwide, paid millions of dollars in bribes to obtain and maintain business from government customers in Brazil, Mexico, and Argentina from at least 2012 to 2016.
According to the SEC’s order, Stericycle staff kept spreadsheets that identified government customers who received bribes. The bribes were referred to with code names, including “alfa” – short for alfajores, a sweet cookie popular in Argentina.
The scheme also included faked third-party vendors who used false invoices to conceal cash payments to government clients.
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Stericycle also failed to have sufficient internal accounting controls in place, the SEC alleged, such as a centralised compliance department, to prevent or even detect the misconduct.
“Stericycle rapidly expanded in Latin America without any meaningful oversight or compliance measures, as evidenced by widespread bribery schemes lasting for many years in most of its Latin America operations,” said Eric I. Bustillo, Director of the SEC’s Miami Regional Office. “Companies in pursuit of global expansion cannot disregard the need for appropriate controls.”
In a statement, the SEC said that Stericycle consented to the SEC’s cease-and-desist order that it violated the anti-bribery, books and records, and internal accounting controls provisions of the FCPA, and agreed to pay approximately $28m in disgorgement and prejudgment interest.
The SEC’s order provides for an offset of up to $4m of any disgorgement paid to Brazilian authorities. Stericycle must also retain an independent corporate monitor for two years followed by one year of self-reporting.
Stericycle entered the Irish market in 2006 through the acquisition of Sterile Technologies from Paul Coulson’s company Yeoman.
At the time, Sterile Technologies was the largest healthcare waste management company in the Republic of Ireland and the UK, with 17 sites.
