In a substantial legal settlement, TIGO Guatemala has agreed to fork over more than $118 million in response to a probe into allegations of foreign bribery. The mobile and telecommunications provider, which operates as a subsidiary of Millicom International Cellular, S.A., based in Luxembourg, has been under the microscope of the U.S. Justice Department. According to official statements, TIGO Guatemala copped to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA).
Details reveal that between 2012 and 2018, TIGO Guatemala, spearheaded by its then-Guatemalan shareholder and senior officers, regularly greased the palms of officials in Guatemala. Moving monthly installments of cash, they sought to curry favor for legislation advantageous to their cause. Entwined with this scandalous affair, narcotrafficking dollars were apparently used for some of these illicit transactions. Voluntarily stepping forward in 2015, Millicom hoped to lay bare the misconduct, but their Guatemalan partners initially stonewalled, making information retrieval akin to pulling teeth, according to the U.S Department of Justice.
The deal struck between TIGO Guatemala and authorities—a two-year deferred prosecution agreement (DPA)—comes at a hefty price tag: a $60 million criminal penalty stacked on top of a $58.2 million administrative forfeiture. As part of this agreement, TIGO Guatemala is mandated to continue its cooperation with the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This includes taking a dive into their own practices to strengthen compliance and regularly update the department on these enhancements over the DPA’s duration. Acknowledging their role in the scheme, TIGO Guatemala garnered some leniency, meriting a 50% reduction off the bottom end of the sentencing guidelines.
After Millicom's full acquisition of TIGO Guatemala in 2021, the company implemented sweeping remedial measures to combat future breaches. They've axed individuals involved in the unsavory dealings and hired new leadership and compliance staff with aims to reform the culture from the inside out. Additionally, they've amped up monitoring for transactions and third-party partnerships, as court documents show. Spanning a decade, these efforts reflect Millicom's intensified focus on global compliance, ballooning dedicated compliance staffing by 800%, and continuously finetuning their internal checks and balances, as noted by the same press release.
Further underscoring the gravity of these actions, the Southern Districts of Florida and California have already brought charges against four individuals connected to the scheme. With the FBI continuing its investigation, the case is led by Trial Attorney Natalie R. Kanerva, Assistant Chief Katherine Raut of the Criminal Division’s Fraud Section, and Assistant U.S. Attorney Eli S. Rubin for the Southern District of Florida.
