WASHINGTON (CN) - Eli Lilly & Co. will pay $29 million to settle charges of bribing foreign officials for contracts in four countries, the SEC said Thursday.
Lilly subsidiaries paid off government officials in Russia, Brazil, China and Poland to secure millions of dollars in business, the SEC said in announcing the settlement.
Lilly's Russian subsidiary "used offshore 'marketing agreements' to pay millions of dollars to third parties chosen by government customers or distributors, despite knowing little or nothing about the third parties beyond their offshore address and bank account information," the SEC said in its statement. "These offshore entities rarely provided any services and in some instances were used to funnel money to government officials in order to obtain business for the subsidiary."
Lilly knew of the Foreign Corrupt Practices Act violations in Russia for more than five years but failed to rein in its subsidiary, the SEC said. Its subsidiaries in Brazil, China and Poland did the same thing, according to the SEC.
"We strongly caution company officials from averting their eyes from what they do not wish to see," an SEC enforcement chief said in the statement.
Lilly agreed to disgorge $14 million, plus $6.7 million in interest, and pay an $8.7 million fine, "for a total payment of $29,398,734," the SEC said.
As is customary with the SEC, Lilly did not have to admit that it did anything wrong.
The settlement is subject to court approval.