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Telefónica Pays $85 Million in Venezuelan Bribery Case
Telefónica's Venezuelan subsidiary paid an $85 million fine to settle US bribery charges related to a 2014 currency auction.
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Spain
Human Rights ViolationsUs PoliticsCorruptionLatin AmericaVenezuelaBriberyTelecommunicationsFine
Telefónica VenezolanaTelefónicaUs Department Of JusticeCnmvSec
César AliertaJosé María Álvarez-PalleteNicole M. ArgentieriDamian Williams
- What factors influenced the final amount of the fine?
- This case highlights the challenges of operating in countries with high levels of corruption and unstable economies. The fine reflects the seriousness of the offense and serves as a warning to other companies operating in similar environments.
- How did Telefónica Venezolana disguise the bribe payments?
- The bribery scheme involved Telefónica Venezolana using two suppliers to make corrupt payments totaling approximately $28.9 million to an intermediary. These payments were disguised as inflated equipment prices.
- What was the main accusation against Telefónica Venezolana?
- Telefónica Venezolana, a subsidiary of Telefónica, agreed to pay an $85.26 million fine to resolve a bribery investigation by the US Department of Justice. The investigation focused on allegations that the company paid bribes to Venezuelan government officials to gain preferential access to US dollars in a currency auction.
- Who were the key figures in Telefónica during the period of the alleged bribery?
- The investigation dates back to 2014, when César Alierta was chairman and José María Álvarez-Pallete was CEO of Telefónica. Telefónica Venezolana's actions allowed them to exchange over $110 million in bolívares for US dollars in the 2014 auction.
- What measures did Telefónica take as part of the agreement with the Department of Justice?
- As part of the agreement, Telefónica Venezolana and its parent company agreed to cooperate with ongoing investigations, improve their compliance program, and implement remedial measures. The fine was reduced due to their eventual cooperation, though initially they resisted.