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SEC v. Textron, Inc.

 
:
Textron -- Textron, Inc.
:
SEC Civil
:
August 23, 2007
:
SEC v. Textron, Inc.
:
SEC v. Textron, Inc., No. 1:07-cv-01505 (D.D.C. 2007)
:
Manufacturing/Engineering
:
Bangladesh, Egypt, India, Indonesia, Iraq, United Arab Emirates
:
2001; 2002; 2003; 2004; 2005
:
The Iraqi government; officials of government-owned companies in Indonesia, Bangladesh, India, Egypt, and UAE.
:
In April 1995, the U.N. adopted Security Council Resolution 986 which permitted Iraq to sell its oil and to use proceeds from those sales to purchase humanitarian supplies such as food for the Iraqi people ("U.N. Oil-for-Food Program" or "OFF"). In an extensive scheme, the Iraqi government received illicit payments in the form of surcharges from oil purchasers and kickbacks, often termed "after sales service fees," from humanitarian goods suppliers. The kickback payments were masked by inflating the contract price, usually by 10% of the contract value.

Textron Inc., a Delaware corporation based in Providence, R.I., settled this action with the SEC without admitting or denying the following facts alleged in the SEC's complaint.

Employees and agents of French subsidiaries of Textron made improper payments, totaling $600,000, to the Iraqi government in connection with oil-for-food contracts worth $1,936,936.

In addition, the same subsidiaries made payments to foreign officials in other countries of approximately $114,995.20 to obtain contracts to provide industrial pumps, gears, and other equipment.
:
Books and records (Issuer), Internal controls (Issuer)
:
Civil penalty, Disgorgement
:
Disgorgement of $2,284,579 in profits, plus $450,461.68 in pre-judgment interest, and a civil penalty of $800,000.
:
3,535,041
:
0
:
Issuer
:
U.S.
:
1,936,926
:
Direct, Sales Agent/Consultant
:
714,995
:
No