The consumer goods company 3M agreed to pay more than $6.5 million to resolve charges that it violated the Foreign Corrupt Practices Act after its China-based subsidiary took Chinese government officials on overseas trips in an attempt to convince them to purchase 3M products, the U.S. Securities and Exchange Commission said.
From 2014 to 2017, 3M's Chinese subsidiary took Chinese government officials on trips for overseas conferences and health care facility visits, which included guided tours, shopping excursions, day trips to nearby attractions and other leisurely activities, the SEC said when announcing the agreement late last week.
The employees of the subsidiary had created a travel itinerary with legitimate events along with alternate itineraries featuring tourist activities near the main events. The employees had asked the travelers to remain quiet about the alternate agenda and they falsified internal compliance documents, according to the SEC.
The Chinese subsidiary of 3M paid nearly $1 million to fund at least 24 trips that included tourist activities for Chinese government officials, the agency said. Additionally, between February 2016 and September 2018, employees of 3M's subsidiary arranged for the company to transfer $254,000 directly to a Chinese travel agency for some of its tourism activities.
The settlement comes after 3M reached a $10.3 billion settlement in June with the SEC over water pollution allegations.