McKinsey Africa, a subsidiary of global consulting firm McKinsey, will pay over $122mn in fines to resolve a US Justice Department investigation into a bribery scheme involving South African government officials.
- •Vikas Sagar, a former senior partner at the firm had previously pleaded guilty, in a deal overseen by prosecutors in South Africa and the US Justice Department.
- •The case stems from an agreement between Sagar and officials of South Africa’s infrastructure parastatals in power and transportation to pay bribes in exchange for information.
- •The deal allowed McKinsey Africa to access “sensitive confidential and non-public information from Transient and Eskom” between 2012 and 2016.”
“McKinsey Africa participated in a yearslong scheme to bribe government officials in South Africa and unlawfully obtained a series of highly lucrative consulting engagements that netted McKinsey Africa and its parent entity McKinsey & Company approximately $85 million in profits,” Damian Williams, U.S. Attorney for the Southern District of New York said.
In the deal, McKinsey will pay a US$ 122, 850, 000 fine, with at least half of the sum being credited to fines the consulting will have to pay in South Africa in related proceedings. According to investigators, the illegal scheme netted the subsidiary and its parent entity McKinsey & Company “approximately US$85 million in profits.”
According to a statement by the Justice Department, the deal was made easier by the consulting firm’s cooperation with the investigation, including producing records, reporting document deletion efforts by Sagar, among other efforts.