The Boston Consulting Group (BCG) has admitted to paying millions of dollars in bribes to secure business in Angola and has agreed to forfeit over $14 million in profits from contracts obtained with the country’s economy ministry and central bank.
According to a US Department of Justice (DoJ) investigation, the consulting firm funneled money into offshore accounts managed by intermediaries linked to Angolan officials and members of the ruling political party.
The bribes were made through BCG’s Lisbon office between 2011 and 2017, violating the US Foreign Corrupt Practices Act (FCPA). However, the DoJ stated it would not prosecute BCG since the firm self-reported the misconduct, dismissed the employees involved, and fully cooperated with the investigation.
In a press release BCG said, “In declining to prosecute, the DOJ cited BCG’s voluntary self-disclosure, full cooperation, and compliance enhancements. In resolving the matter, BCG will disgorge $14.4 million, which the DOJ calculated to reflect BCG’s profits from the impacted work in Angola.”
Meanwhile, the DoJ disclosed that BCG agreed to pay an agent connected to Angolan officials between 20% and 35% of the contract values it secured, using three different offshore entities to channel the payments.
“Certain BCG employees in Portugal took steps to obscure the nature of the agent’s work for BCG when internal concerns were raised, including backdating contracts and falsifying the agent’s purported work product,” the DoJ said.
In total, BCG secured 11 contracts with Angola’s economy ministry and one with the National Bank of Angola during the relevant period, generating $22.5 million in revenue. The firm will return $14.4 million in profits earned from these contracts.
The BCG press release noted that between 2011 and 2017, certain BCG employees improperly paid a third party to secure business. Upon discovery of this, BCG self-disclosed the matter to the DOJ. BCG exited the individuals from the firm and has since closed the office in Luanda, Angola. “BCG has also continued to significantly strengthen its compliance function, internal controls, and training,” the release said.
The DoJ noted that it reserves the right to reopen its investigation into BCG if new information emerges and could still prosecute individuals involved.