WASHINGTON-Friday, August 25th 2017 [ AETOS Wire ]
(BUSINESS WIRE)-- Following new allegations about the conduct of British American Tobacco (BAT) in Africa – published today by The Guardian – the Campaign for Tobacco-Free Kids is urging the U.S. Department of Justice and the U.S. Securities and Exchange Commission to investigate BAT and its subsidiaries for possible violations of the anti-bribery and accounting provisions of the Foreign Corrupt Practices Act (FCPA). Tobacco-Free Kids requested the investigation in a letter today to the two government agencies.
British American Tobacco has faced mounting allegations that the company engaged in widespread bribery and corruption in Africa to gain advantage over competitors and stifle government efforts to curb smoking. Earlier this month, the U.K. Serious Fraud Office (SFO) formally launched an investigation of BAT on suspicions of corruption.
An investigative report published on August 18, 2017 by The Guardian revealed new allegations that, for years, BAT secretly and possibly illegally moved millions of U.S. dollars in cash across international borders into the war-torn Democratic Republic of Congo (DRC) allegedly to support the company’s tobacco leaf operations in that country. The new allegations indicate BAT’s operations included engaging with armed rebels involved in the long-standing DRC conflict in order to make secret cash drops used to pay for tobacco leaf from farmers in Auzi, an unmapped town BAT built in the 1950’s, according to The Guardian.
In addition to possible violations of the FCPA, The Guardian report raises questions about whether BAT’s conduct in moving U.S. dollars during the DRC conflict also violates federal anti-money laundering laws, especially as the U.S. has had sanctions in place against the DRC since 2006. The story also exposes BAT’s role in flooding South Sudan with its cheapest cigarette brands following years of war and operating around terrorist networks in Somalia to continue selling cigarettes in the country.
The growing allegations about BAT’s conduct are particularly alarming following the July 2017 merger of BAT and Reynolds American in the United States. The recent merger places BAT in a leading position in the U.S. market and, according to BAT, created the largest tobacco company in the world by operating profits.
“Given British American Tobacco’s decades-long history of calculated deception in the United States and abroad and its re-entry into the U.S. market, the mounting allegations of corruption and mass concealment of funds by BAT must be fully investigated by U.S. regulators for possible violations of the Foreign Corrupt Practices Act and any other applicable criminal or civil laws,” said Matthew L. Myers, President of the Campaign for Tobacco-Free Kids. “This is a company that has proven it cannot and will not play by the rules. Unless and until they are held accountable by governments, shareholders, business partners and the public, the company’s wrongdoing will only continue.”
Alleged corruption within BAT was first publicly exposed in November 2015 when the BBC, and later other news outlets, revealed allegations that the company was engaging in bribery and other corrupt acts that included bribing Ministry of Health officials in Burundi, Comoros and Rwanda, a former Kenyan Minister of Justice and a Member of Parliament from Uganda.
Tobacco use kills more than seven million people worldwide each year. Without urgent action by governments to pass proven tobacco control laws and curb the power and influence of tobacco companies, tobacco use will kill one billion people this century.
Contacts
Campaign for Tobacco-Free Kids
Jenna Mosley, + 1 202-296-5469
jmosley@tobaccofreekids.org
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