Poland’s Central Anti-Corruption Bureau (CAB) and the Polish Appellate Prosecutor’s Office have recently stepped up their anti-corruption efforts in two international anti-corruption investigations.
Hewlett Packard. Hewlett Packard entered into a $108 million settlement with the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) in connection with a “global labyrinth of financial transactions used by HP to facilitate bribes to foreign officials” in Russia, Mexico, and Poland.
Pursuant to a deferred prosecution agreement, DOJ also filed a criminal information against HP Polska (Poland), United States v. Hewlett-Packard Polska, SP. ZOO, No. CR-14-202 (N.D. Ca. April 9, 2014), for violating the accounting provisions of the Foreign Corrupt Practices Act (FCPA). According to the criminal information filed against HP Polska, from 2006 to 2010, HP Polska falsified HP books and records and circumvented HP internal controls to conceal a scheme to obtain lucrative multi-million dollar technology contracts with Komenda G’owna Policji (KGP), the Polish National Police Agency. To obtain the technology contracts, HP executives delivered bags of cash, laptops, mobile devices, a BMW motorcycle, a Nissan SUV, and other accoutrements to KGP’s Director of Information and Communications Technology. HP also took the official on a leisure trip to Las Vegas which included, among other things, drinks, dining, entertainment, and a private tour flight over the Grand Canyon. HP Polska falsified corporate books and records relied on HP’s officers and external auditors to authorize transactions and prepare HP’s consolidated financial statements.
Glaxo SmithKline (GSK). On the heels of the anti-corruption allegations against GSK in China and Iraq, including violations of the UK Bribery Act from the Serious Fraud Office (SFO), the CAB announced that they are currently investigating GSK, and have already charged several individuals, in connection with alleged bribes paid to Polish doctors between 2010 and 2012 to promote GSK’s asthma drug Seretide.
Criminal charges have been filed against thirteen individuals and prosecutors with the Polish Appellate Prosecutor’s Office maintain that they have sufficient evidence to demonstrate that, at a minimum, GSK paid 13 health centers. Furthermore, according to the CBA, GSK engaged sales representatives in Poland to make payments to physicians, which were allegedly recorded as “educational services” even though the physicians knew that the payments were designed to increase the volume of prescriptions of certain GSK medications, including Seretide. One physician has admitted guilt and has been fined and given a suspended sentence after accepting 100 pounds ($170) for a lecture on Seretide he never delivered.
GSK also admitted that, in 2011, after conducting an internal investigation into the Polish allegations, they unearthed “inappropriate communication” in violation of GSK policy by a single employee. GSK reported that they subsequently disciplined the concerned employee.
GSK continues to investigate the claims and is cooperating with CBA. Notably, the conduct at issue may also violate both the UK Bribery Act and the FCPA.
Sources:
http://www.moneyweb.co.za/moneyweb-international/gsk-faces-criminal-bribery-investigation-in-poland
http://www.theguardian.com/business/2014/apr/14/gsk-accused-bribing-doctors-poland
http://www.bbc.com/news/business-26970873
Given the changing enforcement landscape in Poland, doing business in Poland in 2014 presents risks to businesses. Businesses seeking opportunities in Poland should, where applicable, reevaluate their anti-corruption policies and procedures to ensure that those policies address the UK Bribery Act, the Foreign Corrupt Practices Act, and applicable anti-corruption laws in Poland.
Author: Andrew Feldman
Mr. Feldman represents professionals, corporations, health care providers, and health care marketers in government investigations and prosecutions throughout the United States. Mr. Feldman works tirelessly for his clients from the time an investigation begins until the time a jury renders a verdict.
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