NEW YORK, Dec. 17, 2014 /PRNewswire/ -- Avon Products, Inc.
(NYSE: AVP) today announced that the company has entered into
agreements with the U.S. Department of Justice (DOJ) and the
Securities and Exchange Commission (SEC) related to the previously
disclosed Foreign Corrupt Practices Act (FCPA) investigations. The
terms of agreements are in line with the expected terms the company
previously reported.
"We are pleased to have reached agreements with the DOJ and the
SEC," said Sheri McCoy, CEO of Avon
Products, Inc.
The agreements include aggregate payments of $135 million to the two U.S. government agencies,
with $68 million in fines payable to
the DOJ and $67 million in
disgorgement and prejudgment interest payable to the SEC, in
connection with charges that the company violated the books and
records and internal controls provisions of the FCPA. As previously
disclosed, the company has accrued $135
million for the FCPA matters. Under a deferred
prosecution agreement (DPA), which received court approval today,
the DOJ will defer criminal prosecution of the company for a period
of three years in connection with the alleged violations of the
FCPA. The company has agreed to a corporate compliance monitor,
which with the approval of the government can be replaced after 18
months by the company's agreement to undertake self-monitoring and
reporting obligations for an additional 18 months. If the company
remains in compliance with the DPA during its term, the charges
against the company will be dismissed with prejudice. In addition,
as part of the agreement with the DOJ, Avon Products (China) Co. Ltd., a subsidiary of the company
operating in China, pleaded guilty
today to conspiring to violate the books and records provision of
the FCPA and was sentenced to pay the agreed $68 million fine to the DOJ.
In the settlement papers, the DOJ recognized Avon's cooperation and "extensive
remediation," and noted that Avon's efforts resulted in "important
compliance and internal controls improvements."
Final resolution of the SEC matter is subject to approval by the
United States District Court for the Southern District of
New York. There can be no
assurances regarding if and when the court will approve the SEC
settlement.
Avon, the company for women, is
a leading global beauty company, with $10
billion in annual revenue. As one of the world's largest
direct sellers, Avon is sold
through more than 6 million active independent Avon Sales
Representatives. Avon products are
available in over 100 countries, and the product line includes
color cosmetics, skincare, fragrance, and fashion and home
products, featuring such well-recognized brand names as Avon Color,
ANEW, Skin-So-Soft, Advance Techniques, and mark. Learn more about
Avon and its products at
www.avoncompany.com.
Forward-Looking Statements
Certain statements made in this release, including relating to
court approvals, the corporate compliance monitor, and compliance
with the DPA, may be forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Risks,
uncertainties and other factors exist that may cause results to
differ materially from those set forth in these forward-looking
statements. Factors that could cause the anticipated results to
differ from those described in the forward-looking statements
include whether and when the resolution of the FCPA matters is
finalized through approval of the SEC settlement by the United
States District Court for the Southern District of New York, the duration of the corporate
compliance monitorship and whether and when the company will be
permitted to undertake self-monitoring and reporting, the company's
compliance with the DPA and whether and when the charges against
the company are dismissed with prejudice, and those factors
described in the company's annual report on Form 10-K for the year
ended December 31, 2013, as updated by our Quarterly Report on
Form 10-Q for the quarterly period ended March 31, 2014, and other reports and documents
we file with the SEC. Any forward-looking statements speak only as
of the date they are made. The company does not undertake to update
any such forward-looking statements.
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SOURCE Avon Products, Inc.