Honeywell Expects to Spend at Least $160 Million to Resolve FCPA Investigations

Multinational conglomerate Honeywell Inc. expects to pay upwards of $160 million to settle investigations by the Department of Justice and Brazilian law enforcement over alleged violations of the Foreign Corrupt Practices Act, the company said in its quarterly report filed on Oct. 22 with the Securities and Exchange Commission. The company said it continues to cooperate with DOJ and the SEC throughout the investigations, including regarding a potential resolution of the allegations. Honeywell said that it recorded a $160 million charge in its Consolidated Statement of Operations, also accruing a liability on its Consolidated Balance Sheet to account for the expected payout.

The investigations focus on a project awarded in 2010 relating to Honeywell's use of third parties who previously worked for its Brazilian oil business in Brazil "in relation to Petroleo Brasileiro S.A.," the company said. Honeywell said the investigations focus on FCPA compliance along with similar Brazilian anti-corruption laws. DOJ and the SEC are also looking into a matter involving a foreign subsidiary's past contract with Monaco-based Unaoil S.A.M. in Algeria carried out in 2011, the report said.

"Amounts payable to authorities pursuant to any potential final comprehensive resolution could differ from the amount recorded in our consolidated financial statements," the company said. "Based on available information to date, we do not expect that any such difference would be material with respect to our consolidated financial position."