Late last month, the U.S. Department of Justice charged German automaker Daimler AG with repeatedly violating bribery laws. Today, Daimler announced that it reached settlements with both the U.S. Securities and Exchange Commission and the U.S. Department of Justice.
Charges filed against Daimler included bribery of government officials in Russia, Turkey, Egypt, Iraq, Nigeria, and several other countries. According to the Department of Justice, bribes reportedly worth tens of millions of dollars were paid in return for securing government contracts to supply vehicles. These contracts were reportedly worth hundreds of millions of dollars.
To make amends for its actions, Daimler will pay a $93.6 million fine to the Department of Justice for violating the agency’s books and records regulations. The Securities and Exchanges Commission issued a $91.4 million fine for disgorgement of profits, bringing Daimler’s total penalty to $185 million. Two of Daimler’s subsidiaries -- Daimler North East Asia and Mercedes-Benz Russia -- pleaded guilty in U.S. District Court to the charges of violating anti-bribery laws.
“Compliance has high priority at Daimler,” said Dr. Dieter Zetsche, chairman of Daimler’s board of management, in a statement regarding the settlement. “We have learned a lot from past experience. Today, we are a better and stronger company, and we will continue to do everything we can to maintain the highest compliance standards.”
Under the deferred prosecution agreements reached with the U.S. government, all of the charges will be dropped in two years if Daimler doesn’t incur any further violations in the same time period. Judge Louis Freeh, who has served as an independent compliance advisor to Daimler since 2006, will closely monitor the company’s actions and compliance for three years.