Honeywell To Pay $200M To Settle Bribery Charges

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Facts

  • The US Justice Dept. and Securities and Exchange Commission (SEC) on Monday announced that multinational conglomerate Honeywell International has agreed to pay over $200M to settle corruption investigations in the US and Brazil.
  • The SEC charged Honeywell's US subsidiary UOP with conspiracy to violate the US Foreign Corrupt Practices Act for allegedly bribing high-level executives of Brazil's state-owned oil company Petróleo Brasileiro S.A., better known as Petrobras, from 2010 to 2014 to obtain a $425M contract. UOP reportedly earned $105.5M in profit from the arrangement.
  • The SEC also charged Honeywell Belgium for paying more than $75k to an Algerian government official to win business from Algerian state-owned oil company Sonatrach in 2011.
  • As part of the settlement, Honeywell and its US subsidiary UOP will pay a total of $202.7M in penalties, disgorgement, and prejudgment interest.
  • About $160M of the settlement amount will go to pay US civil and criminal penalties, including an $81M civil penalty to resolve the SEC's charges and an additional $79M criminal penalty to defer potential prosecution against the firm for three years.
  • Meanwhile, Chairman and CEO Darius Adamczyk said Honeywell is "pleased" to have the matter behind it, noting that it had received full cooperation credit.

Sources: Al Jazeera, Justice, Bloomberg, Honeywell, and Reuters.

Narratives

  • Establishment-critical narrative, as provided by Law. While this settlement is a step in the right direction, it's overshadowed by a lack of criminal charges against the company and its leaders. When corporations engage in illegal activities, the executives responsible should face repercussions for their actions. Sparing Honeywell's senior executives the consequences of their responsibility sends the message that bribery is a necessary evil in the corporate world.
  • Pro-establishment narrative, as provided by Eurasia Review. Honeywell proactively disclosed hidden evidence, shared classified documents, and engaged in extensive remedial measures to cooperate with the federal investigation — an effort the settlement has rightfully taken into account. While those responsible should be held accountable, the investigation isn't over.