SEC v. Alliance One International, Inc. (D.D.C. 2010)
Case Details
- Case Name
- SEC v. Alliance One International, Inc. (D.D.C. 2010)
- Countries
- Greece, Indonesia, Kyrgyzstan, Thailand
- Foreign Official
- Officials of the Thailand Tobacco Monopoly (“TTM”); Tax officials in Greece and Indonesia.
- Date of Conduct
-
1996 to 2004
- Nature of Business
- Dimon, Inc. (“Dimon”) and Standard Commercial Corporation (“Standard”) merged in May 2005 to form Alliance One International, Inc. (“Alliance One”), a Virginia corporation. Like its predecessors, Alliance One purchases, processes, and sells leaf tobacco worldwide.
- Influence to be Obtained
- According to the complaint filed by the SEC, from 2000 to 2004, Dimon and Standard together paid bribes of more than $1.2 million to government officials of the TTM. Standard also provided gifts, travel, and entertainment expenses to foreign government officials in the Asia region, including China and Thailand, and in 2004 it made a $50,000 payment to a political candidate, who was also its tobacco sales agent in Thailand. According to the SEC, in 2003, a Dimon subsidiary in Greece paid $96,000 to a Greek tax official in exchange for an agreement not to pursue tax irregularities in an audit, and another Dimon subsidiary in Indonesia made a $44,000 cash payment to an Indonesian tax official in exchange for a tax refund. Dimon allegedly characterized the payment of bribes to TTM officials as commissions paid to Dimon’s agent in Thailand. Similarly, Standard personnel allegedly authorized improper payments to TTM officials and failed to record those payments accurately in Standard’s books and records. The SEC alleges that most of these payments were delivered in bags filled with $100 bills to a high‑ranking government official.
In addition, the SEC alleged that employees of Dimon International Kyrgyzstan, a subsidiary of Dimon, paid approximately $3 million in bribes from 1996 to 2004 to various officials in the Republic of Kyrgyzstan, including officials of the Kyrgyz Tamekisi, a government entity that controlled and regulated the tobacco industry in Kyrgyzstan. Dimon employees allegedly paid bribes totaling $254,262 to five local provincial government officials, known as “Akims,” to obtain permission to purchase tobacco from local growers during the same period. In addition, the employees allegedly paid approximately $82,000 in bribes to officers of the Kyrgyz Tax Police to avoid penalties and lengthy tax investigations.
- Enforcement
- On August 26, 2010, without admitting or denying the SEC’s allegations, Alliance One consented to the entry of a final judgment permanently enjoining it and its subsidiaries from violating the anti‑bribery, books and records, and internal control provisions of the FCPA. Alliance One was also ordered to disgorge $10,000,000. In related criminal proceedings, the DOJ brought criminal actions against two Alliance One subsidiaries, charging each with conspiring to violate the anti‑bribery provisions of FCPA and violating the anti‑bribery provisions of the FCPA. The subsidiary corporations entered into plea agreements with the DOJ, agreed to pay criminal penalties of $9,450,000 and $4,400,000, respectively, and agreed to retain an independent monitor for at least three years. In other related civil proceedings, the SEC charged four Dimon executives with FCPA violations in connection with business in Kyrgyzstan. Without admitting or denying the charges, the four executives consented to injunctive relief and two paid monetary penalties.
- Amount of the Value
- Approximately $4,400,000.
- Amount of Business Related to Payment
- Over $18.3 million in sales contracts.
- Intermediary
- Sales agents.
- Citizenship of Parent Entity
- United States
- Total Sanction
- $ 19,450,000
- Reporting Requirements
- No
Defendants
Alliance One International, Inc.
- Citation
- SEC v. Alliance One Int’l, Inc., No. 10-cv-01319 (D.D.C. 2010).
- Other Statutory Provision
- None
- Disposition
- Complaint and Consent Order, Complaint and Consent Order
- Defendant Jurisdictional Basis
- Issuer
- Defendant's Citizenship
- United States
