The Justice Department and Securities and Exchange Commission jointly announced an enforcement action on Wednesday against a former executive of SAP International for violations of the Foreign Corrupt Practices Act by bribing officials in Panama to win government contracts.
Vicente Eduardo Garcia, 65, of Miami, pled guilty to a one-count information charging him with conspiracy to violate the anti-bribery provisions of the FCPA.
In the SEC’s cease-and-desist order, Garcia agreed to pay disgorgement of $85,965 (the total amount of kickbacks he received), plus prejudgment interest of $6,430, for a total of $92,395. His sentencing for the criminal FCPA violations is scheduled for Dec. 16.
The bribery scheme lasted from 2009-2013. Garcia sought a multi-million dollar contract to provide a Panamanian state agency with an IT upgrade package. Garcia admitted that he conspired with others, including advisers and consultants to SAP, to pay bribes to two Panamanian government officials, as well as to the agent of a third government official, with the understanding that a portion of the money would be paid to the third official.
Garcia used sham contracts and false invoices to disguise the bribes. Most interestingly, according to a Justice Department statement, “Garcia further admitted that he believed paying such bribes was necessary to secure both the initial contract and additional Panamanian government contracts.” The bribery scheme netted the Panamanian SAP channel ops partner at least one contract valued at $14.5 million.
The SEC statement further specified some of Garcia’s conduct that violated the FCPA. It reported that Garcia “circumvented SAP’s internal controls by submitting various approval forms to SAP that falsified the reasons for the excessive discounts to the local partner.” Garcia used both his “SAP e-mail account and his personal e-mail account to communicate details of the bribery scheme and even identify the government officials and intended monetary amounts.” Garcia also conveyed part of the bribery scheme through old-fashioned mail, when he sent “a letter on SAP letterhead detailing fictional meetings in Mexico as requested by the official in order to justify a trip there on false pretenses.”