SEC Charges Tobacco Co. Employees with Bribing Officials
The U.S. Securities & Exchange Commission (SEC) has filed a case against four employees of Danville, Va.-based Dimon Inc., for paying $3 million as bribes to various Kyrgyzstan government official from 1996 to 2004 to purchase Kyrgz tobacco to resell to their customers.
The Commission’s complaint alleges that defendant Bobby J. Elkin, Jr., a former country manager for Kyrgyzstan, authorized, directed, and made the bribes through a bank account held under his name. The SEC further alleges that defendant Baxter J. Myers, a former regional financial director, authorized all fund transfers from a Dimon subsidiary’s bank account to the Elkin account and that defendant Thomas G. Reynolds, a former corporate controller, formalized the accounting methodology used to record the payments made from the Elkins account for purposes of Dimon’s internal reporting.
Finally, the SEC alleges that, from 2000 to 2003, Dimon paid bribes of approximately $542,590 to government officials of the Thailand Tobacco Monopoly in exchange for obtaining approximately $9.4 million in sales contracts.
Without admitting or denying the allegations, Elkin, Myers, and Reynolds consented to final judgments permanently enjoining each of them from violating anti-bribery laws and agreed to pay penalties of $40,000 each.
At the time, Dimon Inc. was the second-largest independent leaf-tobacco merchant in the world and owned tobacco leaf growing companies in the United States and more than 30 other countries, as well as 15 factories for processing the product.
In 2005 Dimon merged with Standard Commercial Corporation to form Alliance One International, Inc (NYSE: AOI), an independent leaf tobacco merchant serving the world’s largest cigarette manufacturers. Alliance One is based in Morrisville, N.C.
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