Fresenius Medical Care AG & Co. KGaA ("FMC"), incorporated and headquartered in Germany, was a provider of products and services for individuals with chronic kidney failure. FMC operated in more than 150 countries, and its shares were registered with the SEC and traded on the New York Stock Exchange. FMC's operations were conducted primarily through a series of subsidiaries in their respective countries. Among the subsidiaries implicated in the alleged misconduct were subsidiaries in Morocco, Portugal, Angola, Turkey, Spain, China, Serbia, Bosnia, and Mexico. In addition, FMC’s West Africa business was managed and operated from Fresenius Medical Care Deutschland GmbH, a German subsidiary, and FMC operated in Saudi Arabia through Saudi Advanced Renal Services Ltd., a wholly consolidated distributor.
According to the documents in this case, from at least 2009 through 2016, FMC paid millions of dollars in bribes to procure business throughout its operations, including in Saudi Arabia, Angola, Gabon, Cameroon, Benin, Burkina Faso, Chad, Ivory Coast, Niger, and Senegal. Additionally, payments made by FMC subsidiaries in those countries as well as Turkey, Spain, China, Serbia, Bosnia, and Mexico were not accurately reflected in FMC’s books and records and, in some cases, indicated that they may have been improper. The company benefited by over $135 million as a result of the improper payments.
In a settled administrative proceeding intiated on March 29, 2019, the SEC issued a cease and desist order against FMC. Under the terms of the proceeding, the SEC ordered FMC to cease and desist violations of the anti-bribery, books and records and internal controls provisions of the FCPA, ordered the company to pay $135 million in disgorgement plus $12 million in prejudgment interest, and to hire an independent compliance monitor for a term of two years and to self report on the status of its anti-corruption compliance for an additional one year.
In a related proceeding, on March 29, 2019, the DOJ entered into a Non-Prosecution Agreement with FMC. Under the terms of the agreement, FMC admitted its conduct and agreed to pay a criminal penalty of $84,715,273 as well as disgorgement and interest of $147 million. The DOJ credited the $147 million that FMC paid to the SEC in its parallel enforcement action. In addition, FMC agreed to retain an independent compliance monitor for a term of two years and to self report on its anti-corruption compliance for an additional one year.
