SEC Settles Charges of FCPA Violations with Bank

A bank agreed to settle charges that it "violated the Foreign Corrupt Practices Act (FCPA) by providing valuable student internships to family members of foreign government officials affiliated with a Middle Eastern sovereign wealth fund." The SEC investigation found that the officials' family members "did not meet the bank's rigorous recruitment criteria, yet were hired with the knowledge and approval of the bank's senior employees in order to corruptly influence foreign officials and win or retain contracts to manage and service the assets of the sovereign wealth fund."

The SEC order stated that the bank lacked sufficient internal controls to prevent and detect these improper hiring practices. According to the SEC, the company had an FCPA compliance policy but "maintained few specific controls around the hiring of customers and relatives of customers, including foreign government officials."

See: SEC Order Instituting Cease-and-Desist Proceedings; SEC Press Release.