U.S. insurance brokerage firm, Aon Corp., has settled a bribery case with the U.S. Department of Justice and the U.S. Securities and Exchange Commission.

In a settlement agreement, the firm agreed to pay approximately US$16.3 million, including US$1.76 million to the DOJ as part of a non-prosecution agreement, and approximately US$14.55 million to the SEC in disgorgement and interest to settle a civil action.

The company was sanctioned for alleged violations of the books and records and internal controls provisions of the Foreign Corrupt Practices Act. In particular, the SEC alleges that Aon subsidiaries made over US$3.6 million in improper payments to various foreign government officials between 1983 and 2007 as a means of obtaining, or retaining, insurance business in those countries.

Without admitting or denying the allegations, Aon consented to the entry of a final judgment permanently enjoining it from future violations and ordering the company to pay disgorgement of US$11,416,814 in profits, together with prejudgment interest of US$3,128,206. In a related criminal proceeding, the DOJ announced that Aon has entered into a non-prosecution agreement and will pay a criminal fine for the misconduct. The firm co-operated with the investigations and implemented remedial measures during the course of the investigations, the SEC notes.

According to the DOJ’s non-prosecution agreement, Aon’s subsidiary in Britain administered funds that were supposed to be used for training and education of officials with Costa Rica’s state-owned insurance company. Instead, the funds were used for trips and other purposes.

The firm admitted that its books and records did not accurately reflect the purpose for which the expenses were incurred. Aon also admitted that it failed to devise and maintain an adequate system of internal accounting controls to ensure compliance with the FCPA.

In addition to the monetary penalty, the DOJ agreement requires that Aon adhere to rigorous compliance, bookkeeping and internal controls standards and cooperate fully with the department.

The firm said that since beginning an internal review of these issues in 2007, it has put in place a comprehensive anti-corruption program designed to prevent and detect improper conduct.

“Aon has invested a significant amount of time and resources in anti-corruption compliance and transparency to greatly enhance our controls and processes,” said Greg Case, president and chief executive officer of Aon, adding that it now believes its compliance practices are a model of best practice for other firms.