Scottish Daily Mail
Budweiser brewer fined £5m for paying bribes
On the day it seals £79bn merger with UK rival
THE world’s biggest brewer has been fined £4.6m after being caught bribing officials into promoting its beer – and then trying to silence a whistleblower by threatening them with a £200,000 fine.
On the day it sealed a £79bn mega merger with London listed SABMiller, Budweiser-brewer AnheuserBusch InBev was punished for using promoters to bribe Indian officials to boost sales of its beer.
The allegations of bribery date back to 2009 when an Indian subsidiary of AB InBev hired a promoter who had no experience in the alcohol industry.
This promoter was found by US investigators to have been paid ‘excessive commissions’ and reimbursements for ‘questionable promotional charges’, which it used to pay the bribes.
AB InBev, which employs 150,000 people, recorded these costs as legitimate business expenses.
Due diligence checks were not carried out on the promoter, but staff tried to cover it up by backdating forms to make it look as though they had been completed.
In 2010 and 2011, an employee told AB InBev bosses the promoting company had been ‘taking care of’ government officials.
The employee also questioned the promoter’s lack of experience, staff and infrastructure. But instead of looking into the claims, AB InBev sacked the worker, and made them sign an agreement promising to remain silent or face a £192,380 punishment.
The worker had also been talking to US investigators but stopped after signing the confidentiality agreement and only passed on information after the investigators issued a legal request.
AB InBev staff also attempted to destroy evidence of the bribery. yesterday, US watchdog the Security and Exchange Commission fined the firm £4.6m for the offences.
It marred celebrations as the company sealed one of the biggest mergers in history.
The deal will bring together brands including Fosters, Becks and Stella Artois in a brewing giant that will make 30pc of the world’s beer.
After the merger is complete, AB InBev will sell one in every four of the world’ s beers.
Jane Norberg, SEC whistleblowing chief, said the threat of financial punishment for whistleblowing was ‘unacceptable’.
Kara Brockmeyer, chief of the SEC’s foreign corruption division, said: ‘Anheuser-Busch recorded improper payments by its sales promoters in India as legitimate expenses in its financial accounting, and then exacerbated the problem by including language in a separation agreement that chilled an employee from communicating with the SEC.’
AB InBev, which has annual revenues of £43.6bn, yesterday said it was pleased to have resolved the SEC probe and that the US justice department had closed its parallel investigation.
The company said Indian employees had since been given extensive training.
It said: ‘Our employees are encouraged to report any activity that they believe might be a violation of laws, regulations, the code of business conduct, or company policies. We remain firmly committed to the highest compliance standards and to growing our business the right way.’