Aon to Pay $16.2 Million to Settle Bribery Charges

By and | December 21, 2011

Insurance brokerage firm Aon Corp. will pay $16.2 million to settle criminal and civil charges that it paid bribes to foreign government officials over more than two decades, the U.S. government said on Tuesday.

Under a non-prosecution agreement with the U.S. Justice Department, Aon will pay $1.76 million and admit to accounting errors related to the bribes.

In a parallel civil case filed in federal court in Washington by the U.S. Securities and Exchange Commission, Aon will pay $14.5 million in disgorgement and interest. In settling the SEC charges, Aon neither admitted nor denied the allegations that it violated provisions of the Foreign Corrupt Practices Act.

The government alleged that Aon subsidiaries made more than $3.6 million in improper payments to officials all over the world, from Vietnam and Costa Rica to Egypt and the United Arab Emirates.

The charges are not based “on an isolated instance of misconduct,” Kara Brockmeyer, head of the SEC’s enforcement unit specializing in Foreign Corrupt Practices Act probes, said in a statement.

“Aon’s subsidiaries repeatedly engaged in misconduct around the world,” she said.

In a statement, Aon said it had invested “a significant amount of time and resources” in updating its anti-corruption compliance.

“Acting with integrity is Aon’s core value, and we embody this in our commitment to the highest professional standards for our clients, markets and colleagues,” Aon Chief Executive Greg Case said.

While the SEC case involves several countries, the Justice Department’s case hinges on one, Costa Rica.

Aon’s UK subsidiary, Aon Ltd, set aside funds to train and educate officials at a state-owned insurance company in Costa Rica, the Justice Department said.

But a “significant portion” of the funds were instead used to reimburse the officials for travel with spouses to tourist destinations like Paris, Monte Carlo and Cologne, and for other non-training activities, it said.

Aon Ltd did not accurately record the expenses on its books, the department said.

Aon settled a related case with U.K. authorities in 2009, agreeing to a £5.25 million ($8.24 million) penalty. ($1 = 0.6372 British pounds)

(Reporting By Sarah N. Lynch and Aruna Viswanatha; Editing by Richard Chang and John Wallace)

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