Legg Mason to pay $64m to settle US Libya corruption probe ,
the US asset manager, has reached a $64m settlement with the Department of Justice, which had launched a foreign corruption probe centred on one of its arm’s activities in Libya. Between 2004 and 2010, Permal – a Legg Mason subsidiary acquired in 2005 – had partnered with Société Générale to win business from Libyan government entities. During this time SocGen paid bribes through a Libyan “broker” in connection with 14 investments made by Libyan entities, including seven that benefited Permal according to the DoJ. In a statement the DoJ said: The Department reached this resolution based on a number of factors, including that Legg Mason did not voluntarily and timely disclose the conduct at issue, but fully cooperated in the investigation and fully remediated. Moreover, Legg Mason’s misconduct involved only mid-to-lower level employees of Permal, a subsidiary company, and was not pervasive throughout Legg Mason or Permal; Société Générale – and not Legg Mason or Permal – maintained the relationship with the Libyan broker and was responsible for originating and leading the scheme; the profits earned by Legg Mason and Permal were less than one-tenth of the profits earned by Société Générale; and neither Legg Mason nor Permal has a history of similar misconduct. SocGen separately announced that it had agreed to pay over $1.3bn to the DoJ and the French Parquet National Financier to settle the Libyan bribery case, according to statements by both authorities on Monday. Legg Mason had previously set aside $67m to cover the cost of settling the Foreign Corrupt Practices Act investigation. In a statement the US asset manager said it expects to reach a settlement over the same issue with the Securities and Exchange Commission, with chief executive officer Joe Sullivan stating: Let me be very clear: the misconduct by former employees of the legacy Permal business that the government found was totally unacceptable. It violated our high standards, our long-held core values and our “no-chalk” culture. Copyright The Financial Times Limited 2018. All rights reserved.
Sam Morgen dabaibanews