BCG to cough up £11m to US Dept of Justice over bribes in Angola
US consultant giant Boston Consulting Group (BCG) has been found to have paid bribes in exchange for business in Angola, despite that, the firm has avoided prosecution following a deal with the Department of Justice (DoJ).
The US DoJ investigation found evidence that from about 2011 until about 2017, BCG, through its Portuguese office in Lisbon, had paid its agent in Angola the equivalent of $4.3m (£3.2m) in commissions to help the firm obtain business with the Angolan government.
The DoJ stated that “BCG agreed to pay the agent 20 to 35 per cent of the value of any government contracts procured and sent the funds to the agent’s three different offshore entities.”
The agency added that “certain BCG employees in Portugal took steps to conceal the nature of the agent’s work for BCG when internal questions arose, including by backdating contracts and falsifying the agent’s purported work product.”
It was noted that the consultancy giant secured eleven contracts with Angolan Ministry of Economy and one with the National Bank of Angola, which resulted in revenues of approximately $22.5m (£17m)and profits for BCG in the amount of approximately $14.424m (£11m).
Despite this, the DoJ has decided to decline prosecution of this matter, citing the firm’s voluntary self-disclosure, full cooperation and compliance enhancements.
In a statement by BCG, its spokesperson stated “upon discovery of [employees paying to secure business] BCG promptly self-disclosed the matter to the DOJ.”
The firm said it has “exited the individuals” from the firm and has since closed the office in Luanda, Angola. The DoJ also noted it withheld bonuses for those former employees.
“In resolving the matter, BCG will disgorge $14.4m (£11m), which the DOJ calculated to reflect BCG’s profits from the impacted work in Angola,” the firm’s spokesperson stated.
However, the DoJ noted that this agreement “does not provide any protection against prosecution of any
individuals, regardless of their affiliation with BCG.”
“If the government learns information that changes its assessment of any of the factors outlined above, it may reopen its inquiry,” the DoJ added.