Southern Glazer’s takes ‘zero tolerance’ stance against ‘pay-to-play’

22nd December, 2017 by Melita Kiely

Southern Glazer’s Wine and Spirits (SGWS) says it has made “significant improvements” to its employee compliance programme after being fined US$3.5 million for illegal ‘pay-to-play’ activity.


Southern Glazer’s Wine & Spirits said it took “swift and immediate action to address any compliance issues”

The wholesaler entered into a no contest plea agreement with the New York State Liquor Authority following an investigation into trade practice violations within the company.

SGWS agreed to immediately pay a civil penalty of US$2.5m to settle the charges, with an additional suspended US$1m civil penalty that will be erased after a 12 months on the condition of continued cooperation and implementation of an enhanced state-wide compliance programme in relation to the matter.

‘Pay-to-play’ schemes are illegal in the US, and include giving illegal gifts and services to businesses to “influence their purchasing decisions”, for allowing incomplete, inaccurate and inadequate record-keeping practices, and for engaging in discriminatory sales, which all violate the 2006 Wholesale Consent Order and Decree.

Alison Herman, senior counsel, regulatory compliance, Southern Glazer’s Wine and Spirits, said: “Southern Glazer’s has provided substantial cooperation with the Authority during the investigation and upon learning about the allegations, took swift and immediate action to address any compliance issues.

“The company takes these issues very seriously and has made significant improvements to its compliance programme, including appointing a corporate compliance officer, implementing routine audits and reporting protocols, continued and advanced employee training, a code of ethics, and vigorous and appropriate enforcement of its disciplinary policy state-wide.

“Southern Glazer’s has zero tolerance for any activity that violates trade practice rules and expects every employee to adhere to the highest ethical standards.

“The company looks forward to working with the Authority in 2018 to ensure its policies and procedures are executed without exception and trusts that the rest of the industry will follow suit to ensure compliance with the rules that govern our business.”

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