Avon finds evidence of more improper payments: report

By @ibtimes on

Avon Products Inc faces more woes as its internal bribery investigation found that the company may have made improper payments in countries besides China, the Wall Street Journal reported on Wednesday.

There is evidence of millions of dollars of questionable payments to officials in Brazil, Mexico, Argentina, India and Japan in amounts that are not insignificant, the newspaper reported, citing a person familiar with the matter.

The possible payments occurred as recently as 2010 and as long ago as 2004, the Wall Street Journal reported. According to the report, one employee in those markets was suspended and there are more suspensions to come.

The investigation is ongoing. As you would expect, we do not comment on ongoing investigations. Nor do we comment on rumors or speculation, regardless of whether they may be accurate or inaccurate, an Avon spokesman told Reuters in an email.

The company has already come under fire for the costly investigation of possible bribery that began in China in 2008. It spent about $96 million in 2010 on its investigation and has said in the past it planned to spend a similar amount on that probe this year. It spent about $35 million on the investigation in 2009.

In its quarterly report, filed on Tuesday, Avon said the company fired four employees who were put on administrative leave in 2010.

The former general manager for China, former head of corporate affairs for China, former head of finance for China and former head of global internal audit and security, who was previously head of finance for the Asia Pacific region, were terminated, it said.

Avon also said that, pending the outcome of its investigation and compliance reviews, more personnel actions might be taken.

Avon is shaking up its structure to improve business in markets such as Latin America, its largest unit, with more than 42 percent of sales last year. In February, it made plans to cut six business units to two, one focused on developed markets and one focused on developing areas.

Avon shares fell about 2 percent in after-hours trade.

(Reporting by Jessica Wohl; Editing by Andre Grenon and Steve Orlofsky)

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