What went wrong when McKinsey paid bribes to secure consulting contracts with South Africa's state-owned enterprises? In this episode, Michael Volkov dives into the December 2024 DOJ settlement with McKinsey & Company, which paid $122 million after being found guilty of paying bribes to officials at Transnet and Eskom to secure valuable consulting contracts. The case involved significant violations of the Foreign Corrupt Practices Act (FCPA) and highlights the risks companies face when failing to implement effective compliance programs.
You’ll hear him discuss:
- The details of McKinsey's settlement with the DOJ for $122 million, including the 35% discount and the cooperation credits granted by the government.
- The role of Vikas Sagar, McKinsey's former senior partner, and his guilty plea in 2022 for orchestrating bribery payments.
- How McKinsey Africa used sensitive, non-public information obtained through bribes to secure multi-million dollar contracts with Transnet and Eskom.
- The ongoing issue of engaging third-party intermediaries and the importance of conducting thorough due diligence before entering into business relationships.
- The lessons learned from McKinsey’s lack of proper oversight and controls that allowed a small group of corrupt executives to facilitate bribery schemes.
- The broader impact of local content requirements in international business and the associated risks of partnering with unqualified entities that have ties to corrupt government officials.
Resources
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The Volkov Law Group
