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 The Justice Department and the Securities and Exchange Commission
have been asking global companies in a range of industries including
oil and gas, telecommunications and consumer products for
information about their hiring practices to determine if they could
amount to bribery, these people said.
On Wednesday, mobile chipmaker Qualcomm Inc said it could face a
civil action from U.S. authorities over alleged bribery of officials
associated with state-owned companies in China. It also said it
found instances in which "special hiring consideration" was given to
people associated with state-owned companies or agencies in China.
Qualcomm declined to comment on Friday. The Justice Department and
SEC declined to comment on whether they have expanded their probes.
Some of the new inquiries have zeroed in on hires in China, South
Korea and southeast Asia, including Singapore, two of the people
familiar with the probes said.
It was not clear how many companies were involved in the expanded
probes and the people, who declined to be named because details of
the investigations are not public, did not name specific firms.
Hiring issues have become a focus in bribery probes as a matter of
course, sources said. That reflects a change in the wake of the
investigation into whether JPMorgan hired children of China's
state-owned company executives with the express purpose of winning
underwriting and other business, they added.
If employees were hired at the direction of an official at a
state-run company who was in a position to grant a U.S.-linked
company business, the American firm could run afoul of the Foreign
Corrupt Practices Act (FCPA), a 1970s law that bars bribes to
officials of foreign governments, for instance.
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"The government is starting to recognize there may be widespread
abuse but the misperception that it is not illegal," one source
said.
Proving corrupt intent on the part of both the officials and the
companies hiring the workers would be difficult, though, defense
lawyers predicted.
Charles Duross, who led the Justice Department's FCPA unit until
January, when he joined the law firm Morrison & Foerster, said a job
offer could constitute a "thing of value" under the law but the
challenge would be proving a quid pro quo.
In the wake of the JPMorgan probe, Reuters reported in November the
SEC had sent letters to Morgan Stanley and other banks, including
Goldman Sachs and Citigroup, seeking information about their hiring
practices.
The new inquiries involve employees who were potentially qualified
for their jobs, and performed work, as well as "no-show" jobs, where
people do not do work for which they are paid, sources said. In the
past, few cases by U.S. authorities have dealt with hiring practices
that involved real jobs.
A Singapore-based lawyer said that companies across Asia have been
reviewing hiring practices as a result of the probe into banks, but
the lawyer said he was unaware that anyone was involved yet in a
formal investigation.
(Additional reporting by Matthew Miller in Beijing and Rachel
Armstrong in Singapore; editing by Caren Bohan and Peter Henderson)
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