CARTEL-LINKED CONDUCT AND THE SCOULAR FCPA RESOLUTION

Between 2013 and 2019, Scoular used multiple customs brokers to facilitate rail shipments of corn and other agricultural products from the US into Mexico. Under Mexican law, those shipments were subject to phytosanitary inspection for dirt, soil and impurities. When inspections threatened to cause delays or adverse consequences, instead of addressing the compliance issues, Scoular authorised its brokers to make improper payments to Mexican government officials. Over this period, brokers paid more than $400,000 in bribes — disguised on invoices as “reinspection fees” – and allowed Scoular to avoid over $6.5m in fees and costs. A portion of those payments ultimately benefitted individuals who helped operate a cartel at the border.

The US Department of Justice (DOJ) charged Scoular in the Western District of Texas with conspiracy to violate the Foreign Corrupt Practices Act’s (FCPA’s) anti-bribery provisions, arguing that these funds “ultimately benefitted people who helped operate a cartel” at the US-Mexico border. Under the deferred prosecution agreement (DPA), Scoular agreed to pay over $10m, consisting of a combined criminal penalty of $9,769,521 and forfeiture of $414,351. Notably, the penalty reflects a 25 percent reduction from the bottom of the US Sentencing Guidelines range, credited to cooperation and remediation, though Scoular received no voluntary self-disclosure credit, which would have resulted in a significantly lower penalty under the DOJ’s own disclosure policies. Moreover, no independent compliance monitor was imposed; instead, Scoular is required to maintain and periodically report on its anti-corruption compliance programme for the three-year term.

In deciding on a DPA instead of a more punitive resolution, the DOJ credited Scoular’s internal investigation, factual presentations, production of documents (notwithstanding early deficiencies), identification of culpable individuals and securing of counsel for current employees.

Oct-Dec 2026 Issue

Willkie Farr & Gallagher LLP