Avon Embroiled in Bribery Probe

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Avon ladies selling products at a sale in New York in 2009. / REUTERS

In an amended lawsuit, shareholders of Avon Products allege that a top Avon executive was about to provide government regulators with information about foreign bribery — until the company bought his silence.

The shareholders charge that Fabian LaPresa, who had drafted an internal audit showing that Avon executives had bribed Chinese officials, received extra benefits when he left the company in 2006. Those benefits, the shareholders say, came after LaPresa told his supervisor that he would disclose the contents of the audit unless he received the extra benefits. LaPresa was about to be booted from the company for expense account violations, and was seeking to extract a larger severance benefit.

The lawsuit, according to Reuters, was filed by two German investment funds, LBBW Asset Management Investmentgesellschaft mbH and SGSS Deutschland Kapitalanlagegesellschaft mbH, on behalf of other Avon shareholders. LaPresa managed to negotiate one year of salary and health benefits rather than a few months of support.

In 2008, Avon, the cosmetics giant, announced it had opened an internal inquiry into whether it had violated the U.S. anti-bribery laws in China. Two years earlier, in what was seen as a major coup, Avon received the first-ever license by a western company to sell its products door-to-door.

Sweep to Suit alleges Avon paid to keep official quiet in bribery probe

Former Irish Prime Minister Bertie Ahern. / REUTERS

Former Irish Prime Minister Bertie Ahern was once known as a party-hardy premier who could seemingly do no wrong.

Now, in a long-awaited verdict, three judges have found that Ahern received at least $276,000 in secret payments and then repeatedly lied about this under oath. Still, Ahern seems to have escaped any serious consequences for his alleged actions. The judges cleared Ahern of corruption charges, citing a lack of evidence that Ahern gave favors in exchange for the money.

Ahern left office in 2008, after 11 years in power, just as evidence being collected by a tribunal looking into his finances began to leak out. Reuters reports that Ahern’s downfall tracks that of the nation. Ahern was widely praised for a banking bubble that brought new wealth to the nation, and then blamed when the bubble burst, shaking the Irish economy and angering voters.

The judge’s report said that corruption was “endemic and systemic” at every level of government in Ireland in the late 1990s.

One point that aided Ahern was the absence of credible anti-bribery laws in Ireland until 1996, making tax evasion the only easily proven offense. Some of the charges against Ahern dated back to 1994.

Sweep to Former Irish PM Ahern’s explanation of benefits untrue — inquiry 

The press has an important role in rooting out corruption. People are innocent until proven guilty. And the government should respond to reports of corruption by the media.

Those are the words of . . . Russian President Dimitry Medvedev. In a speech, he said that it is the duty of the press to monitor the work of all leaders and civil servants to expose corruption. “All of us – from the president to the village chieftain — must react to publications in the media,” said Medvedev, according to a report in the Russian press agency RT.

Given that Russia has long ranked as one of the most corrupt countries, it will be interesting to see how much resonance his words will actually have.

Sweep to Media has key role in war against corruption-Medvedev

Leslie Wayne

Leslie Wayne

Leslie Wayne, former senior editor at 100Reporters, is an award-winning business reporter, formerly at The New York Times. Ms. Wayne joined The Times in 1981 and has covered Wall Street, banking industry regulatory reform, municipal finance scandals and, most recently, the aerospace and military industries. Ms. Wayne has an M.B.A. in finance from Columbia Business School and was also a Knight-Bagehot Fellow in Business and Economic Journalism.

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