Two US tobacco companies settle bribery charges with SEC, Justice Department

Tobacco companies settle bribery charges

WASHINGTON — Two American tobacco companies are paying nearly $30 million to settle charges that they bribed foreign officials to get lucrative overseas tobacco sales contracts.

The companies, Universal Corp. of Richmond, Va., and Alliance One International of Morrisville, N.C., faced civil and criminal charges from the Securities and Exchange Commission and Justice Department, the government said Friday.

Universal was accused of bribing officials in Thailand, Malawi and Mozambique. Alliance One is accused of bribing officials in Thailand, China, Greece, Indonesia, and Kyrgyzstan.

To settle the charges, Alliance One has agreed to pay a criminal fine of $9.45 million and return $10 million in profits. Universal has agreed to pay a criminal fine of $4.4 million and return $4.5 million in profits.

Alliance One could not be reached for comment. Universal Corp. said in a statement that the company voluntarily reported the problems to authorities and that it has cooperated with the investigation.

“We have absolutely no tolerance for this type of activity,” CEO George C. Freeman III said in a statement.

Universal said that it had already put aside funds to cover the settlement amount, so it will not have to log a charge for its fiscal 2011 results.

Universal will use an independent corporate monitor to look over its accounting practices and will change or take up new policies as needed, the company said. The Justice Department will not prosecute Universal if it follows terms of an agreement between the department and the company for the next three years, Universal said.

Universal shares fell 52 cents, or 1.4 percent, to $37.55 in afternoon trading Friday. Shares of Alliance One rose 8 cents, or 2.4 percent, to $3.42.

AP Business Writer Rachel Metz contributed to this report from San Francisco.