What’s next, a cup of coffee bought for a custom’s official while you are waiting for the inspection? That is the question which came to the mind of The Man From FCPA when he read about the self-disclosure made to the Justice Department by Lennox International over a $475 facilitation payment made by the company in Russia. In its October, 10-Q filing the company stated, “In October 2016, the company self-reported to the Securities and Exchange Commission (SEC) and the Department of Justice (DoJ) an alleged payment in the amount of 30,000 rubles (approximately U.S. $475) to a Russian customs broker or official. The company, under the oversight of its Audit Committee, has initiated an investigation into this matter with the assistance of external legal counsel and external forensic accountants.”
The howling over this disclosure was far and wide. The FCPA Professor asked if this was “the most absurd voluntary disclosure ever?” The FCPA Blog said the company was hoping to obtain a declination under the Justice Department Pilot Program. The Man From FCPA certainly finds it to be a head-scratcher because this payment, standing along, should not give any company the idea that it needs to self-disclose to the Justice Department and SEC. Yet, the company did voluntarily disclose to both the department and the agency.
