PAY UP:Ralph Lauren’s company has to cough up $1.5 million-plus to settle charges that one of his execs paid bribes to get goods into Argentina.
(WireImage)
PAY UP: Ralph Lauren’s company has to cough up $1.5 million-plus to settle charges that one of his execs paid bribes to get goods into Argentina (
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A top exec of a Ralph Lauren subsidiary in Latin America bribed customs officials for five years to get goods into Argentina, officials disclosed yesterday in announcing the blue-chip clothier would get hit with more than $1.5 million in penalties.
Ralph Lauren Corp. discovered illegal payoffs during an internal review in 2010, then fired the unidentified general manager and other employees involved and shut down stores in Argentina, officials said.
The firm acknowledged that the executive — who is a dual citizen of the United States and Argentina — bribed customs officials to help speed the clearance of goods through inspection.
The bribes to Argentine officials included perfume, dresses and handbags worth up to $14,000 a piece. They were disguised through phony invoices.
Brooklyn federal prosecutors announced an agreement with Ralph Lauren Corp. to give up more than $700,000 in ill-gotten profits and pay an $882,000 penalty.
Under the agreement reached with the Justice Department, the corporation will be under close scrutiny for a two-year period. The agreement warns the company that future missteps or failure to disclose other past misconduct could open the door to criminal prosecution.
Ralph Lauren Corp. said it had uncovered the wrongdoing and quickly reported it to the feds.
“There was no evidence that the improper activity in Argentina was known or authorized by anyone outside of Argentina or that similar practices were occurring at other foreign operations,” it said.
The bribes to customs officials in Argentina helped the company move goods without submitting required paperwork, induced inspectors there to overlook prohibited items and, at times, allowed for goods to be cleared without any inspection whatsoever, officials said.
The payments were disguised by means of invoices for bogus claims for “loading and deliver expenses” and “stamp tax/label tax,” according to the agreement.
The money was concealed by funneling it through a customs-clearance agency.
The feds decided not to charge any executives personally after the firm cooperated with the criminal probe and pledged a wide range of reform measures, including ethics and anti-bribery training, officials said.
The Justice Department and the SEC have been cracking down on violations of the Foreign Corrupt Practices Act, which bars bribes to officials of foreign governments.