SEC Charges Consumer Loan Company With FCPA Violations
World Acceptance Corporation paid over $4 million in bribes to Mexican government and union officials through its subsidiary WAC de Mexico between 2010 and 2017 to secure loan access and repayment guarantees, disguising the payments as legitimate expenses and failing to maintain adequate internal controls, resulting in a $21.7 million SEC settlement without admission of guilt.
World Acceptance Corporation agreed to pay $21.7 million to resolve SEC charges that its Mexican subsidiary, WAC de Mexico, paid more than $4 million in bribes to Mexican government and union officials from December 2010 to June 2017 to ensure loan approvals and timely repayments from government employees. The bribes were disguised as legitimate business expenses in the company’s books and paid via bank deposits and cash deliveries through intermediaries, while the company lacked sufficient internal accounting controls and fostered a compliance-deficient culture. Without admitting or denying the allegations, World Acceptance consented to a cease-and-desist order and paid $17.826 million in disgorgement, $1.9 million in prejudgment interest, and a $2 million penalty for violating the FCPA’s anti-bribery, books and records, and internal controls provisions.
World Acceptance Corporation, a South Carolina-based consumer loan company, agreed to pay $21.7 million to resolve SEC charges that its former Mexican subsidiary, WAC de Mexico, paid over $4 million in bribes to Mexican government and union officials between December 2010 and June 2017 to secure the ability to lend to government employees and ensure timely repayment. The bribes were disguised in the company’s books as legitimate business expenses and delivered through bank accounts linked to officials and cash payments distributed by intermediaries. The SEC found that World Acceptance lacked adequate internal accounting controls and that senior management failed to establish an appropriate tone at the top, undermining internal audit and compliance functions and enabling the scheme to persist for nearly seven years. The company did not admit or deny the findings but consented to a cease-and-desist order prohibiting future violations of the FCPA’s anti-bribery, books and records, and internal controls provisions. The settlement included $17.826 million in disgorgement, $1.9 million in prejudgment interest, and a $2 million civil penalty. The SEC’s investigation was conducted by its FCPA Unit with assistance from the U.S. Department of Justice, the U.S. Attorney’s Office for the Southern District of New York, and the FBI. This case highlights systemic failures in corporate governance and compliance oversight that allowed a long-running foreign bribery scheme to flourish unchecked.
Exhibits & Attached Documents (1)
Extracted insights
- $21.70M $21.7 million $10M–$100M
- $17.83M $17.826 million $10M–$100M
- $4.00M $4 million $1M–$10M
- $2.00M $2 million $1M–$10M
- $1.90M $1.9 million $1M–$10M
- person charles e. cain
- agency Securities and Exchange Commission
- agency the sec’s investigation
- agency the sec’s order
- agency the securities and exchange commission
- person wac mexico
- company world acceptance corporation
- The Securities and Exchange Commission Announced World Acceptance Corporation has agreed to pay $21.7 million to resolve charges that it violated the Foreign Corrupt Practices Act (FCPA)
- World Acceptance Corporation Paid More than $4 million in bribes to Mexican government officials and union officials to secure the ability to make loans to government employees and ensure that those loans were repaid in a timely manner
- WAC Mexico Paid The bribes in a variety of ways, including by depositing money into bank accounts linked to the officials and by hiring an intermediary to distribute large bags of cash among the officials
- The SEC’s order Finds These bribes were inaccurately recorded in World Acceptance Corporation’s books and records as legitimate business expenses
- The SEC’s order Finds World Acceptance Corporation lacked internal accounting controls sufficient to detect or prevent the payments of such bribes
- The SEC’s order Finds Management lacked the appropriate tone at the top regarding internal audit and compliance, thereby undermining the effectiveness of those functions
- Charles E. Cain Said This long-running bribe scheme did not happen in a vacuum. Through a lack of adequate internal accounting controls and a culture that undermined its internal audit and compliance functions, World Acceptance Corporation created the perfect environment for illicit activity to occur for nearly a decade
- World Acceptance Corporation Consented to the entry of an order Requiring that the company cease and desist from violating the anti-bribery, books and records, and internal controls provisions of the FCPA, and pay $17.826 million in disgorgement, $1.9 million in prejudgment interest, and a $2 million penalty
- The SEC’s investigation Was conducted by Jennifer T. Calabrese of the FCPA Unit and supervised by Ansu N. Banerjee
- The SEC Appreciates the assistance of The U.S. Department of Justice Criminal Division’s Fraud Section, the U.S. Attorney’s Office for the Southern District of New York, and the Federal Bureau of Investigation
The Securities and Exchange Commission today announced that World Acceptance Corporation, a South Carolina-based consumer loan company, has agreed to pay $21.7 million to resolve charges that it violated the Foreign Corrupt Practices Act (FCPA). The SEC’s order finds that from at least December 2010 through June 2017, World Acceptance Corporation’s former Mexican subsidiary, WAC de Mexico S.A. de C.V., paid more than $4 million in bribes to Mexican government officials and union officials to secure the ability to make loans to government employees and ensure that those loans were repaid in a timely manner. According to the SEC’s order, WAC Mexico paid the bribes in a variety of ways, including by depositing money into bank accounts linked to the officials and by hiring an intermediary to distribute large bags of cash among the officials. The SEC’s order finds that these bribes were inaccurately recorded in World Acceptance Corporation’s books and records as legitimate business expenses. The SEC’s order further finds that World Acceptance Corporation lacked internal accounting controls sufficient to detect or prevent the payments of such bribes and that management lacked the appropriate tone at the top regarding internal audit and compliance, thereby undermining the effectiveness of those functions. “This long-running bribe scheme did not happen in a vacuum. Through a lack of adequate internal accounting controls and a culture that undermined its internal audit and compliance functions, World Acceptance Corporation created the perfect environment for illicit activity to occur for nearly a decade,” said Charles E. Cain, Chief of the SEC Enforcement Division’s FCPA Unit. Without admitting or denying the SEC’s findings, World Acceptance Corporation consented to the entry of an order requiring that the company cease and desist from violating the anti-bribery, books and records, and internal controls provisions of the FCPA, and pay $17.826 million in disgorgement, $1.9 million in prejudgment interest, and a $2 million penalty. The SEC’s investigation was conducted by Jennifer T. Calabrese of the FCPA Unit and supervised by Ansu N. Banerjee. The SEC appreciates the assistance of the U.S. Department of Justice Criminal Division’s Fraud Section, the U.S. Attorney’s Office for the Southern District of New York, and the Federal Bureau of Investigation.
The Securities and Exchange Commission today announced that World Acceptance Corporation, a South Carolina-based consumer loan company, has agreed to pay $21.7 million to resolve charges that it violated the Foreign Corrupt Practices Act (FCPA). The SEC’s order finds that from at least December 2010 through June 2017, World Acceptance Corporation’s former Mexican subsidiary, WAC de Mexico S.A. de C.V., paid more than $4 million in bribes to Mexican government officials and union officials to secure the ability to make loans to government employees and ensure that those loans were repaid in a timely manner. According to the SEC’s order, WAC Mexico paid the bribes in a variety of ways, including by depositing money into bank accounts linked to the officials and by hiring an intermediary to distribute large bags of cash among the officials. The SEC’s order finds that these bribes were inaccurately recorded in World Acceptance Corporation’s books and records as legitimate business expenses. The SEC’s order further finds that World Acceptance Corporation lacked internal accounting controls sufficient to detect or prevent the payments of such bribes and that management lacked the appropriate tone at the top regarding internal audit and compliance, thereby undermining the effectiveness of those functions. “This long-running bribe scheme did not happen in a vacuum. Through a lack of adequate internal accounting controls and a culture that undermined its internal audit and compliance functions, World Acceptance Corporation created the perfect environment for illicit activity to occur for nearly a decade,” said Charles E. Cain, Chief of the SEC Enforcement Division’s FCPA Unit. Without admitting or denying the SEC’s findings, World Acceptance Corporation consented to the entry of an order requiring that the company cease and desist from violating the anti-bribery, books and records, and internal controls provisions of the FCPA, and pay $17.826 million in disgorgement, $1.9 million in prejudgment interest, and a $2 million penalty. The SEC’s investigation was conducted by Jennifer T. Calabrese of the FCPA Unit and supervised by Ansu N. Banerjee. The SEC appreciates the assistance of the U.S. Department of Justice Criminal Division’s Fraud Section, the U.S. Attorney’s Office for the Southern District of New York, and the Federal Bureau of Investigation.