- The Washington Times - Thursday, September 15, 2011

Bridgestone Corp. agreed Thursday to plead guilty and pay a $28 million fine for its role in conspiracies to rig bids and make corrupt payments to government officials in Latin America in the sale of marine hose and other industrial products manufactured by the company and sold globally.

Acting Assistant Attorney General Sharis A. Pozen, who heads the Justice Departments Antitrust Division, said a two-count criminal information - filed in U.S. District Court in Houston - charged the Tokyo-headquartered firm with conspiring to violate the Sherman Act and the Foreign Corrupt Practices Act (FCPA).

According to the court document, Bridgestone sought to rig bids, fix prices and allocate market shares of marine hose in the United States and elsewhere and, separately, conspired to make corrupt payments to government officials in various Latin American countries to obtain and retain business. The Justice Department said the scheme ran from January 1999 through May 2007.

Under terms of the plea agreement, which is subject to court approval, Bridgestone also agreed to cooperate fully in the departments ongoing investigations.

Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities. During the bid- rigging conspiracy, according to court records, the cartel affected prices for hundreds of millions of dollars worth of marine hose and related products sold worldwide.

According to the antitrust charge, Bridgestone agreed to allocate shares of the marine hose market and to use a price list for marine hose to implement the conspiracy.

As part of the conspiracy, Ms. Pozen said Bridgestone provided information received from customers in the United States and elsewhere about upcoming marine hose jobs to a co-conspirator who served as the coordinator of the conspiracy. She said the company received marine hose prices for customers in the United States and elsewhere from the coordinator of the conspiracy, sold the marine hose to those customers at collusive and noncompetitive prices and then concealed the conspiracy through various means, including code names, private email accounts and private telephone numbers.

The Justice Department also charged that to secure sales of marine hose in Latin America, Bridgestone authorized and approved corrupt payments to foreign government officials employed at state-owned entities, and Bridgestones local sales agents agreed to pay employees of state-owned customers a percentage of the total value of planned sales.

When Bridgestone secured a sale, it would pay the local sales agent a “commission” consisting of not only the local sales agents actual commission but also the corrupt payments to be made to employees of the state-owned customer, the records show. The local sales agent was responsible for passing the agreed-upon corrupt payment to the employees of the customer.

Ms. Pozen said Bridgestone is the fifth company to be charged in the department’s bid-rigging investigation. To date, nine persons have been convicted and sentenced to a total of nearly 13 years in prison, including Misao Hioki, former general manager of Bridgestones international engineered products department, who was sentenced to two years in prison on Dec. 10, 2008.

Under the plea agreement, Ms. Pozen said the department recognized Bridgestones cooperation in the probe, including conducting a worldwide internal investigation, voluntarily making employees available for interviews, and collecting, analyzing and providing to the department voluminous evidence and information.

She said Bridgestone also agreed to restructure its business, terminate many of its third-party agents and take remedial actions with employees responsible for many of the corrupt payments.

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