GOL also entered a three-year deferred prosecution agreement (DPA) with the Department of Justice (DOJ). Under the settlement terms, GOL will pay a $17 million criminal penalty, up to $1.7 million of which the DOJ has agreed to credit against a $3.4 million fine GOL received from Brazilian authorities in related proceedings.
Additionally, GOL entered a cease-and-desist order and will pay approximately $24.5 million over two years as part of a parallel resolution with the Securities and Exchange Commission (SEC). According to the SEC, GOL’s scheme took place “against a backdrop of insufficient internal accounting controls, and the bribes were characterized as legitimate business expenses in Gol’s recordkeeping.”
The $41.5 million in total civil and criminal penalties is a far cry from the $87 million criminal penalty that the Fraud Section and the company agreed was appropriate, which reflected a 25 percent discount off the bottom of the applicable Sentencing Guidelines fine range. However, due to Gol’s demonstrated financial condition and inability to pay the fines in full, the SEC and the DOJ waived payment of all but $24.5 million and $17 million of Gol’s payment obligations, respectively.
Case details
According to the company’s admissions and court documents, between 2012 and 2013, GOL conspired to offer and pay approximately $3.8 million in bribes to various foreign officials in Brazil in order to secure the passage of two pieces of legislation favorable to the company. “The legislation involved certain payroll tax and fuel tax reductions that financially benefitted GOL, along with other Brazilian airlines,” the Justice Department stated.
Court documents further revealed that, to effectuate the bribery scheme, a member of GOL’s board of directors “caused GOL to enter into sham contracts with, and make payments to, various entities connected to the relevant Brazilian officials. GOL maintained books and records that falsely listed the corrupt payments as legitimate expenses, including as advertising expenses and other services,” the agency stated.
Settlement terms
Under the DPA, GOL has agreed to continue to cooperate with the Department in any ongoing or future criminal investigations relating to this conduct. In addition, GOL agreed to continue to enhance its compliance program and provide reports to the Department regarding remediation and the implementation of compliance measures for the term of the DPA.
The DOJ said it reached its resolution with GOL based on numerous factors. For example, GOL received full cooperation credit with the Department’s investigation for, among other things, “timely providing the facts obtained through the company’s internal investigation, which included reviewing voluminous documents, interviewing witnesses, conducting background checks, and testing over two thousand transactions,” the agency stated.
The DOJ further credited GOL with “promptly” engaging in remedial measures, including:
- Conducting a comprehensive risk assessment;
- Redesigning its entire anti-corruption compliance program;
- Forming a compliance department and hiring a new chief compliance officer;
- Re-evaluating and supplementing its anti-corruption policies and procedures, such as its relationship with third-party vendors and suppliers; and
- Terminating its relationships with third parties involved in the misconduct.
In addition, the GOL director involved in the scheme resigned from his position and has had no role at the company since. In a press release, GOL acknowledged the settlement and its terms but provided no further comment. 
Jaclyn Jaeger is a contributing editor at Compliance Chief 360° and a freelance business writer based in Manchester, New Hampshire.