SEC Charges Company with Violating FCPA at Olympic Games

The SEC charged a global resources company with violating the Foreign Corrupt Practices Act ("FCPA") when it sponsored the attendance of foreign government officials at the 2008 Summer Olympic Games in Beijing (the "Games").

An SEC investigation found that the company failed to "devise and maintain sufficient internal controls" over a global hospitality program hosted by it in connection with its sponsorship of the Games.

According to the SEC, the company invited 176 government officials and employees of state-owned enterprises to attend the Games at the company's expense. Sponsored guests were given "hospitality packages" that included event tickets, luxury hotel accommodations and sightseeing excursions.

Despite the company's requirement that business managers complete a hospitality application form for any individuals they sought to invite to the Games, the SEC found that the company failed to provide employees with any specific training on how to complete forms or evaluate bribery risks. As a result, a number of the hospitality applications were inaccurate or incomplete, and invitations were extended to government officials connected to pending contract negotiations or regulatory dealings.

See: SEC Order.