This article first appeared in the St. Louis Beacon: A $50,000 cash bribe paid by an agent of Monsanto Co. to an Indonesian environmental official is at the center of a story in today's New York Times about the Justice Department's more relaxed approach toward corporate crime.
The bribe story is actually several years old. The Justice Department announced Jan. 6, 2005 that Monsanto Co. had been charged with a violation of the Foreign Corrupt Practices Act (FCPA) for its involvement in an illegal payment of $50,000 to a senior Indonesian Ministry of Environment official. The Justice Department said the company had falsely certified the payment as "consultant fees" in the company's books. The company agreed to pay a $1 million fine and, according to the Justice Department press release, to "accept responsibility for the conduct of its employees in paying the bribe and making the false books and records entries, adopt internal compliance measures and cooperate with ongoing criminal and SEC civil investigations." Washington lawyer Timothy Dickinson was appointed to oversee company compliance.
The government said that a "Monsanto employee responsible for certain activities in the Asia-Pacific Region authorized and directed the Indonesian consulting firm to make an illegal payment totaling $50,000 to the senior environment official to 'incentivize' him" to waive environmental requirements for Monsanto's cotton crops. The Justice Department said that the Monsanto employee "also directed representatives of the Indonesian consulting company to submit false invoices to Monsanto for 'consultant fees' to obtain reimbursement for the bribe, and agreed to pay the consulting company for taxes that company would owe."
The point of today's New York Times story is that the handling of the Monsanto case is an example of the kinder and gentler approach the Justice Department has taken to corporate crime since the days of the Enron case. Former Attorney General John Ashcroft figures into this story as well. Ashcroft headed the Justice Department during the tough enforcement days, but he also has served as an overseer of corporate wrongdoers since leaving the department. The former attorney general has been criticized for the size of the fees. As the Times put it: “Deferred prosecution agreements, or D.P.A.'s, have become controversial because of a medical supply company's agreement to pay up to $52 million to the consulting firm of John Ashcroft, the former attorney general, as an outside monitor to avoid criminal prosecution. That agreement has prompted congressional inquiries and calls for stricter guidelines.”
Neither Dickinson nor Monsanto's spokesperson responded immediately to calls for comment.
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