On August 12, 2015, Vincente Garcia (former head of Latin American sales for SAP International, Inc.) pleaded guilty in federal court in San Francisco to violations of the Foreign Corrupt Practices Act (FCPA). In addition to pleading guilty to a criminal information filed by DOJ, Mr. Garcia also settled civil FCPA charges brought by SEC in a rare simultaneous FCPA enforcement action against an individual. SAP International is a wholly owned U.S. subsidiary of global technology services company SAP A.G., which is based in Germany.
In mid-July, DOJ quietly filed a one-count criminal information against Garcia in the Northern District of California, charging him with conspiracy to violate the FCPA’s anti-bribery provisions, 15 U.S.C. § 78dd-2, as Garcia is a U.S. citizen and thus a “domestic concern.” On Wednesday of this week, Garcia pleaded guilty. According to the charges, Garcia participated in a scheme to bribe Panamanian officials to secure government technology contracts for SAP from 2009 to 2013. In late 2009, SAP sought a multimillion-dollar contract to provide a technology upgrade package to a Panamanian state agency. Garcia admitted that he conspired with others, including an advisor, two consultants, and one of SAP’s channel partners, to pay bribes to two Panamanian officials and the agent of a third government official (with the understanding that at least a portion of the money would be transmitted to the third official) to secure the contract. The bribes were paid through sham contracts and false invoices to disguise the true nature of the payments. SAP’s Panamanian channel partner was ultimately awarded the contract for $14.5 million, which included $2.1 million in SAP software licenses, and soon thereafter was awarded additional contracts that included SAP products. Garcia admitted that he believed paying the bribes was necessary to secure both the initial contract and additional Panamanian government contracts. Sentencing before U.S. District Court Judge Charles Breyer is scheduled for December 16, 2015.
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