1667597244 Social

Insurance Broker Arthur J. Gallagher Subpoenaed by Justice Department’s Foreign Bribery Unit

Arthur J. Gallagher & Co. said it had received a subpoena from the Justice Department’s Foreign Bribery Unit, making it the latest company to be caught up in a wide-ranging investigation into corruption at state-owned companies in Ecuador.

The Rolling Meadows, Ill.-based insurance brokerage firm disclosed the subpoena in a quarterly financial report this week. The information request, which the company said it received in its third quarter, was from the Justice Department’s Foreign Corrupt Practices Act unit, Arthur J. Gallagher said.

Prosecutors from that unit asked Arthur J. Gallagher for information related to his insurance business with public entities in Ecuador, the company said in its Nov. 2 report.

The FCPA is an anti-bribery law that prohibits companies with ties to the US from paying bribes to foreign government officials to obtain a business advantage. The law is enforced by the Department of Justice and the US Securities and Exchange Commission.

The Justice Department’s FCPA unit has pursued corruption investigations at state-owned enterprises in Latin America for years, in a multi-agency effort that has produced dozens of indictments against businessmen and current and former government officials in Ecuador and Venezuela.

A spokesman for Arthur J. Gallagher did not immediately respond to a request for comment. The company said in its filing that it is cooperating with the government’s investigation and that it does not expect the investigation to result in a material loss.

A spokesperson for the Department of Justice declined to comment on the announcement.

One recent line of the Justice Department’s investigation has focused on state-owned Ecuadorian insurance companies. In July, the department charged three men it said conspired to pay bribes to officials at Seguros Sucre SA and Seguros Rocafuerte SA.

The charges followed the unsealing in March of an indictment accusing Ecuador’s former comptroller general, Carlos Ramon Polit Faggioni, of using the US financial system to launder the proceeds of illegal bribery schemes. In one scheme described by prosecutors, Mr. Polit allegedly received bribes from an Ecuadorian businessman to help him obtain contracts from Seguros Sucre.

The allegations surrounding Seguros Sucre also involved an insurance brokerage now owned by Marsh & McLennan Cos. In a public letter to Jardine Lloyd Thompson Group Holdings Ltd. in March, prosecutors said they found evidence that the company paid more than $10 million to a Florida-based middleman, who in turn paid more than $3 million in bribes to help him receive contracts with Seguros Sucre.

In its letter, the Justice Department said it declined to prosecute Jardine Lloyd Thompson, citing the company’s decision to voluntarily report the case and strengthen its compliance program.

Write to Dylan Tokar at dylan.tokar@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Related Posts