Sunday, May 22, 2022

Stericycle Agrees to Pay Over $84 Million in Coordinated Foreign Bribery Resolution

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Medical-waste-management company Stericycle Inc. has agreed to pay about $90 million to settle allegations it violated antibribery laws in the U.S. and Brazil, U.S. authorities said Wednesday.

The Bannockburn, Ill.-based company faced both criminal and civil charges after the Justice Department and the Securities and Exchange Commission launched parallel investigations into its compliance with the U.S. Foreign Corrupt Practices Act. Stericycle also agreed to pay fines to resolve parallel investigations by Brazilian authorities.

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U.S. prosecutors said Stericycle admitted to paying about $10.5 million in bribes to foreign officials in Brazil, Mexico and Argentina to win and keep business between 2011 and 2016. The company earned at least $21.5 million in profit from the scheme, according to the Justice Department. The FCPA prohibits companies with U.S. ties from paying bribes to foreign officials to gain a business advantage.

U.S. authorities said Stericycle agreed to pay a total of more than $84 million to resolve the case, including $52.5 million to the Justice Department and $28.2 million to the SEC. In considering the amount, U.S. regulators gave the company credit for the penalties imposed by Brazilian authorities of more than $17 million.

A Stericycle spokeswoman said the company agreed to pay a total of about $90 million, primarily accrued in the third and fourth quarters of 2021. The spokeswoman declined to provide a breakdown.

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As part of the settlements, the company will enter into a deferred-prosecution agreement with the Justice Department for three years, meaning no enforcement action will be taken if it meets the obligations in the agreement. Stericycle also agreed to hire an independent compliance monitor for two years and then report on its compliance for another year.

“Resolving this legacy matter represents another important milestone in Stericycle’s business transformation journey,” Chief Executive Cindy Miller, who joined the company in 2018 and became CEO in 2019, said in a statement.

The settlements come about two months after Stericycle disclosed the deal with U.S. authorities in its annual financial results. The company said the investigations dated to at least June 2017.

Stericycle said it cooperated with the investigations and conducted its own probe. It also established a global anticorruption compliance program and named new members to its board and executive team since 2017, including Ms. Miller.

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The Justice Department credited Stericycle for its cooperation and remedial measures, but said the company failed to disclose the pervasive misconduct in a voluntary and timely manner. The company also hasn’t fully tested its compliance program, the Justice Department said, necessitating an independent monitor.

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