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U.S. v. Goodyear International Corp.

 
:
Goodyear International Corp.
:
DOJ Criminal
:
May 11, 1989
:
U.S. v. Goodyear International Corp.
:
U.S. v. Goodyear Int'l Corp., No. 89-0156 (D.D.C. 1989).
:
The auditors of Goodyear International Corp. discovered the illegal payments in the course of examining advertising expenditures. The company self-disclosed the violations to the DOJ.
:
Automotive
:
Iraq
:
1978; 1979; 1980; 1981; 1982; 1983; 1984
:
Officials of the Iraqi state-owned trading organization
:
In early 1978, David Janasik, the Middle East regional export manager for Goodyear International Corp. (GIC), met with officials of the Iraqi state-owned trading organization, Iraqi Trading Company (ITC), which purchases virtually all of the tires for sale in Iraq. In a private meeting with Janasik, one of the ITC officials, Mohammed Jassem, informed Janasik that GIC's competitors in France, Korea, and Japan had been willing to pay cash commissions to ensure "good relationships" with ITC and that it would only get a limited amount of business with ITC without such payments. Janasik initially declined but, after getting pressured from his superiors to get the business despite ITC's request, later negotiated a 7% cash commission for the ITC officials. Following this agreement, GIC got over $19 million worth of business from ITC through three transactions.
Janasik and other GIC officials used advertising agencies to cover the cash commissions to be paid to the ITC officials. In one instance, they engaged a Greek company to conduct "marketing studies," who provided a very superficial report. The invoiced amount was deposited into the Greek company's bank account in the Union Bank of Switzerland (UBS). Janasik opened an account under his name in the same bank, and a substantial portion of the invoiced amount was then transferred to Janasik's account. Janasik withdrew money from this account to pay the ITC officials. In another instance, Janasik and other GIC officials had false invoices prepared on the letterhead of a defunct advertising agency for purportedly placing Arabic advertisements in Baghdad newspapers. The invoiced amounts were deposited into an account in UBS which was opened under the name of the defunct advertising agency for this specific purpose. Janasik then transferred the money into his account at UBS.
Janasik later agreed with a representative of the corrupt ITC officials to keep $75,000 of the cash commissions for his efforts. In September 1988, he pleaded guilty to filing a false tax return on the $75,000. He was fined $10,000 and sentenced to two years of probation.
:
Anti-bribery (Domestic Concern)
:
Fine, Plea
:
Goodyear International Corp. agreed to plead guilty and to pay a fine of $250,000.
:
250,000
:
0
:
Domestic Concern
:
U.S.
:
Contract Procurement/Retention
:
19,000,000
:
Cash
:
Subcontractor
:
981,124
:
Greece
:
Switzerland
:
No