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SEC Charges Gol Intelligent Airlines

By September 28, 2022 No Comments

The Securities and Exchange Commission today announced that Gol Intelligent Airlines S.A. (Gol) has agreed to pay a total of $7,562,000 to settle charges that it violated the Foreign Corrupt Practices Act (FCPA) by providing lavish benefits to government officials in Brazil. Gol, Brazil’s second largest airline, is publicly traded on NASDAQ under the symbol “GOL.” Between 2010 and July 2012, Gol provided Brazilian government officials with free or discounted personal travel, including flights for vacation and holidays; free or discounted vacations at hotels owned by third parties in Brazil and abroad; and free or discounted ground transportation services, including chauffeured car services and hotel shuttles.

Gol is Brazil’s second largest airline and has publicly traded stock on NASDAQ under the symbol “GOL.”

The Securities and Exchange Commission announced today that Gol has agreed to pay a total of $7,562,000 to settle charges that it violated the Foreign Corrupt Practices Act (FCPA) by providing lavish benefits to government officials in Brazil.

Gol provided Brazilian government officials with free or discounted personal travel including flights for vacation and holidays; free or discounted vacations at hotels owned by third parties in Brazil and abroad; and free or discounted ground transportation services, including chauffeured car services and hotel shuttles.

According to the SEC’s order, from at least 2010 until 2015, Gol’s sales staff provided these benefits after receiving internal warnings against doing so on multiple occasions. Moreover, Gol failed to devise and maintain a sufficient anti-corruption compliance program as required by the books-and-records and internal controls provisions of the federal securities laws.

According to the SEC’s order instituting settled administrative proceedings, Gol failed to devise and maintain a sufficient anti-corruption compliance program as required by the books-and-records and internal controls provisions of the federal securities laws.

Gol’s failure to establish an adequate anti-corruption compliance program was particularly egregious because in addition to being a publicly traded company with more than $1 billion in assets, it also had significant operations outside of Brazil where it conducted business with government officials who were potentially vulnerable to corruption.

Specifically, Gol paid Brazilian government officials cash bribes to induce them to purchase airfare from Gol and often failed to record these payments on its books and records. In addition, Gol’s internal controls were inadequate, including a lack of effective oversight of its anti-corruption compliance program; monitoring of the use of funds by third parties; maintenance of accurate accounts receivable records related to improper payments; and failure to implement adequate training programs focused on bribery risk areas.

The SEC’s order also finds that Gol failed to devise and maintain an adequate system of internal accounting controls as required by the Sarbanes-Oxley Act.