FBI targets Johnson & Johnson, Siemens, GE, Philips in Brazil bribery case

RIO DE JANEIRO: The U.S. FBI is investigating corporate giants Johnson & Johnson, Siemens AG, General Electric Co and Philips for allegedly paying kickbacks as part of a scheme involving medical equipment sales in Brazil, two Brazilian investigators have told Reuters.
Brazilian prosecutors suspect the companies channelled illegal payoffs to government officials to secure contracts with public health programs across the South American country over the past two decades.
Brazilian authorities say more than 20 companies may have been part of a “cartel” that paid bribes and charged the government inflated prices for medical gear such as magnetic resonance imaging machines and prosthetics.
The four multinational companies, with a combined market capitalization of nearly $600 billion at Thursday’s market close, are the largest foreign enterprises to be investigated in an unprecedented anti-corruption push in Brazil in recent years.
Big U.S. and European companies found to have engaged in wrongdoing in Brazil could also face heavy fines and other punishment under the U.S. Foreign Corrupt Practices Act (FCPA). Since 1977, that law has made it illegal for American citizens, U.S. companies or foreign companies whose securities are listed in the United States to pay foreign officials to win business.
Foreign companies are the latest targets of government corruption probes in Brazil. Over the past five years, prosecutors have uncovered pervasive graft in state institutions and private-sector companies seeking to do business with them. — Reuters