Bribery a way of life for companies operating in emerging markets

Bribery is a way of life for British companies working in emerging markets, with 85pc of managers forced to resort to it to do business, according to a new report.

A 12-year inquiry by Prof Andrew Kakabadse, of Henley Business School,  claims the vast majority of UK managers operating in these markets resort to the dishonest practice on a monthly basis – often with the tacit permission of their chief executives.

The days of used banknotes being handed over in brown envelopes are gone, Mr Kakabadse said, with bribery having turned into a “highly organised, almost professionalised, business of agents taking 'facilitation fees’ to secure deals”. 

Bribery is so institutionalised in some markets he said he had been told of instances of agents bidding against each with lower bribes – usually a percentage of a contract’s value, and often up to 10pc  – to make sure a company engaged them. read more »

Freeing the False Claims Act

Thirty years ago, President Reagan signed the False Claims Amendments Act of 1986, an anti-fraud measure whose extraordinary success is a timely reminder of what’s possible when Washington acts in a focused, bipartisan spirit.

Inspired by reports that contractors were charging the U.S. military $7,600 apiece for coffee makers, among other scandals, the statute gave fresh teeth to the venerable False Claims Act, a law originally signed by Abraham Lincoln to combat fraud by suppliers to the Union Army.

Since 1986, according to a Department of Justice tally, the retooled FCA has allowed the federal government to claw back $50 billion wrongfully billed to taxpayers, an astonishing haul that actually understates the law’s effect, because it omits both criminal penalties and the FCA’s deterrent effect.

Yet the FCA remains under perennial assault from corporate interests and ill-informed court opinions.

Corruption in China: Crocodile Meat, Jade, Piles of Cash

Feasts of crocodile tail. Pricey liquor by the bucketful. A nanny employed just to take care of pets. Bundles of jade bracelets worth millions. A free trip to the World Cup in Brazil.

Titillating scenes from “Lifestyles of the Rich and Famous”? Not quite. They are highlights from a new Chinese television series about official corruption and loose living that is best described as “Lifestyles of the Venal and Disgraced.”

The documentary series, actually titled “Always on the Road,” has been shown on state television this week to emphasize that President Xi Jinping is serious about wiping out graft. Some of China’s most notorious fallen officials are shown repenting on camera, warning of the misery that comes from dirty wealth and imprisonment. read more »

Dozens of Individuals Indicted in Multimillion-Dollar Indian Call Center Scam Targeting U.S. Victims

Today, an indictment was unsealed charging a total of 61 individuals and entities for their alleged involvement in a transnational criminal organization that has victimized tens of thousands of persons in the United States through fraudulent schemes that have resulted in hundreds of millions of dollars in losses.  In connection with the scheme, 20 individuals were arrested today in the United States and 32 individuals and five call centers in India were charged for their alleged involvement.  An additional U.S.-based defendant is currently in the custody of immigration authorities. read more »

Judge orders Lynn Tilton to turn over Zohar loan fund documents

A Delaware judge on Wednesday ordered Lynn Tilton's Patriarch Partners to turn over documents detailing the complex holdings of $2.5 billion distressed debt funds that the embattled investor lost control of this year.

Tilton created the loan vehicles known as the Zohar funds more than a decade ago. The three funds have financed her investments in ailing companies such as Dura Automotive Systems, earning her the title of "Diva of Distressed." read more »

SEC Backs Ex-Atty's Bid To Revive Whistleblower Suit

The U.S. Securities and Exchange Commission on Wednesday backed a former in-house tax attorney for Vanguard Group Inc. in his bid to get the Third Circuit to revive his whistleblower suit claiming was fired for issuing warnings about the company’s purported tax fraud, saying that internal company reporting is protected from retaliation.

In an amicus curiae brief, the SEC weighed in on David Danon’s bid to overturn the dismissal of his suit against his former employer, which included claims under the Dodd-Frank Act, the False Claims Act, the Sarbanes-Oxley Act and the Pennsylvania Whistleblower Law. Vanguard had recently told the panel that the case was rightly tossed in May, arguing in part that Danon's Dodd-Frank claim should be dismissed because he failed to report his allegations to the SEC before the alleged retaliation. read more »