After over eight years of investigation, the Swiss Office of the Attorney General’s (OAG) probe into hi-tech security ink and traceability solutions firm SICPA has finally concluded. In a decision published on 27 April, the OAG determined that the Prilly-based company was liable for “organisational deficiencies,” while clarifying in its side-letter that SICPA had not been held responsible for committing any acts of corruption.
The company has maintained from the beginning of the case that it was innocent of any wrongdoing, with SICPA CEO Philippe Amon asserting that his certainty that the firm would have won the case had it ended up before the Federal Criminal Court. However, SICPA has decided not to appeal the decision in order to turn the page on a chapter which has dragged on and given fodder to its competitors.
Furthermore, SICPA has acknowledged that there were gaps in its compliance processes years ago which made it difficult for the company to prove in this case that it had the right structure in place to adequately ensure that its contractors were corruption-free, yet continues to adamantly reject direct involvement in any graft and has called into question the charges’ legal grounds themselves.
Establishing responsibility
By way of context, the OAG launched the case back in 2015 upon receiving a legal assistance request pertaining to foreign investigations into alleged bribe payments made to high-ranking government officials in Brazil, Colombia and Venezuela by an ex-SICPA sales manager apparently operating without the company’s knowledge or consent.
The former employee in question was eventually, in fact, acquitted in the Brazilian case, and SICPA was neither investigated nor even notified of any form of corporate wrongdoing by local authorities in Colombia or Venezuela. However, the OAG has imposed on SICPA a CHF 1 million fine – out of a legal maximum penalty of CHF 5 million – as well as a CHF 80 million compensation claim based on alleged profits from the Brazilian contracts over a 5-year period covered in the investigation.
While the company accepts some responsibility in the case, acknowledging the OAG’s assessment that previous “organisational deficiencies” – namely inadequate “corporate governance, risk management and compliance processes” – left the company open to being taken advantage of by bad actors, it emphasises that these former deficiencies did not constitute its committing of any corruption offence.
Bolstering anti-corruption defences
Moreover, the OAG has recognised that, since its discovery of these internal flaws potentially exploitable by rogue associates, SICPA has “voluntarily and fully addressed this organisational deficiency”.
The company has taken a variety of measures in recent years to combat corruption, including a process of systemic internal restructuring of its compliance department that culminated in SICPA’s anti-bribery, compliance and competition protection systems receiving ISO 37001 certification in 2021 – making it one of the first in its sector to receive this international anti-bribery compliance standard. The Swiss firm has since maintained this status, with a February audit of its anti-bribery system establishing full ISO compliance, while it continues an active role as an accredited member of the anti-corruption Banknote Ethics Initiative.
“Compliance with the law and doing business with integrity are not optional”, Philippe Amon underlined following the OAG ruling, but “crucial as a basis for trust, which is at the heart of what we do”. Indeed, as a company entrusted with providing governments and private firms traceability solutions to combat currency counterfeiting as well as the illicit trade in tobacco, alcohol and fuel – among others – strict internal governance is particularly important for a company like SICPA. In this regard, the company’s capacities have been further bolstered by its dedicated anti-corruption Compliance Team, Global Competition Law Policy and locally-based network of Business Compliance Ambassadors who safeguard the company’s overseas operations.
Case underscores OAG’s increasing aggressiveness
While the OAG did clearly acknowledge SICPA’s progress in improving its compliance processes, the office’s press release announcing the closure of the case employed a noticeably harsh tone, leading to some misleading headlines in Swiss media outlets suggesting that the company had been “convicted of corruption”, rather than having accepted a charge of organisational deficiencies in order to move past the affair.
The OAG’s aggressiveness, both in the investigation and in their communication about the case’s closure, could possibly stem from the significant domestic civil society pressure it has faced recently.
In January, Transparency International (TI)’s Swiss branch published a report condemning the OAG for failing to adequately prosecute the corporate corruption that feeds Switzerland’s reputation as a financial crime haven. While the Swiss criminal code has, since 2003, allowed for the prosecution of companies that fail to implement proper anti-corruption and money laundering safeguards, the report reveals that only 10 convictions for these offenses have materialised in the past two decades.
Moreover, Martin Hilti, director of Transparency Switzerland, has highlighted that “Swiss companies involved in big international corruption…scandals are generally held accountable abroad, but not in Switzerland,” citing Swiss mining giant Glencore as an example. Last year, the mining firm plead guilty to multiple charges of bribery and market manipulation, paying some $1.5 billion in combined penalties in the US and UK after investigators in those two countries found a slew of wrongdoing, including an apparent eight year-long fuel price manipulation scheme and its agents’ and employees’ payment of over $25 million—with the company’s knowledge and approval—in bribes for preferential access to oil in five African countries.
Yet, Glencore has never been convicted in Switzerland. As Hilti noted, “leaving foreign authorities obliged to launch prosecutions against Swiss companies paints a poor image” of Switzerland. What’s more, a separate Transparency International report from 2021 criticised the Swiss prosecutor’s office for its relatively weak financial penalties, which are vital for disincentivising corporate corruption.
Considering the nature of these reproaches, the OAG’s zeal in the SICPA case could thus be interpreted as an attempt to establish a new image as an anti-corruption hawk. Moving forward, the OAG should continue to ramp up corporate oversight and seek to build a positive national image for business integrity, while crucially ensuring that this fight is motivated always by principle rather than fanfare and positive media coverage.
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