McKinsey subsidiary will pay $122M for scheme to bribe South African officials, US says
Dec 5, 2024, 11:51 AM
WASHINGTON (AP) — An African subsidiary of the consulting firm McKinsey & Company Inc. will pay a criminal penalty of more than $122 million to resolve a U.S. Justice Department investigation into a yearslong scheme to bribe South African government officials, U.S. authorities said Thursday.
The scheme involved bribes to officials with South Africa’s state-owned and state-controlled custodian of ports, rails, and pipelines, as well as its state-controlled energy company in order to secure contracts, according to the Justice Department. It netted McKinsey Africa and its parent company $85 million in profits between 2012 and 2016, officials said.
The Justice Department has entered into a deferred prosecution agreement with McKinsey Africa, which will allow the company to avoid prosecution under the Foreign Corrupt Practices Act if it follows certain terms.
McKinsey said in a statement that it “welcomes the resolution of these matters and the closure of this regretful situation.” The company said it has cooperated with authorities and has made “significant upgrades” to its “risk, legal and compliance controls.”
A former McKinsey senior manager, who has pleaded guilty to a federal charge in connection to the scheme, was fired more than seven years ago shortly after the company learned about the issues, the company said.
“McKinsey is a very different firm today than when these matters first took place,” it said.
