A Brazilian airline has been ordered to pay more than $41 million to resolve an international bribery investigation which involved law enforcement in Brazil and the United States.
Between 2012 and 2013, low-cost carrier GOL Linhas Aéreas Inteligentes offered and paid nearly $4 million to Brazilian government officials in order to secure the passage of two new laws that would financially benefit the airline, court documents reveal.
A member of the airline’s board of directors is alleged to have ordered employees to create sham contracts with third-party vendors in an attempt to hide the bribe payments amongst legitimate day-to-day business expenses.
Some of the fake payments were written off as advertising expenses, but the airline was forced to sift through thousands of transactions when it eventually agreed to own up to the corruption after investigators started asking questions.
GOL was able to secure a reduction in the amount it will pay the Department of Justice under the terms of a three-year deferred prosecution agreement because it fully cooperated with the investigation.
“GOL paid millions of dollars in bribes to foreign officials in Brazil in exchange for the passage of legislation that was beneficial to the airline,” said Assistant Attorney General Kenneth A. Polite Jr.
The legislation involved certain payroll tax and fuel tax reduction provisions.
“The company entered into fraudulent contracts with third-party vendors for the purpose of generating and concealing the funds necessary to perpetrate this criminal conduct, and then falsely recorded the sham payments in their own books.”
GOL has been ordered to pay a criminal penalty of $17 million to the DOJ after winning a 25 percent discount for agreeing to introduce remedial measures, including completely redesigning its anti-corruption program. The fine had already been reduced because of GOL’s financial position and “demonstrated inability” to pay the penalty.
In addition, GOL will pay the U.S. Securities and Exchange Commission (SEC) around $24.5 million over the next two years and will be required to pay an additional £3.4 million to Brazilian authorities to settle a parallel investigation.
Mateusz Maszczynski honed his skills as an international flight attendant at the most prominent airline in the Middle East and has been flying throughout the COVID-19 pandemic for a well-known European airline. Matt is passionate about the aviation industry and has become an expert in passenger experience and human-centric stories. Always keeping an ear close to the ground, Matt's industry insights, analysis and news coverage is frequently relied upon by some of the biggest names in journalism.