The country’s largest wine and spirits distributor has entered into an agreement with federal prosecutors to resolve allegations that its executives and employees bribed alcohol retailers for favorable placement of certain products.
Southern Glazer’s Wine and Spirits LLC, headquartered in Florida, will pay $12.5 million to the U.S. Treasury and step up efforts to comply with federal and state laws, according to the non-prosecution agreement signed Thursday by representatives of the company and the U.S. Attorney’s Office for the Northern District of California.
In exchange, the Alcohol and Tobacco Tax and Trade Bureau has agreed to take no action against the company for the conduct involved in the investigation.
In the agreement, the company admitted that employees provided improper payments and benefits to alcohol retailers for years, including cash, gift cards, luxury goods, resort stays, golf trips and airfare. The employees concealed the actions using third-party vendors and false invoices.
California is Southern Glazer’s Wine and Spirits’ largest market, and the scheme included several of the company’s California-based executives, including multiple vice presidents, according to the agreement.
“Southern Glazer’s employees tried to distort the wine and spirits market in California through bribes and other improper conduct and in the end it was the consumer that lost out,” U.S. Atty. Craig Missakian said in a statement.
The company also agreed to continue cooperating with the government in criminal prosecutions related to the matter.
“This conduct does not reflect Southern Glazer’s values, culture, or standards and it will not be tolerated,” said Wayne E. Chaplin, Southern Glazer’s president and chief executive, in a statement.
A federal grand jury, in March, indicted five former Southern Glazer’s employees on conspiracy to commit bribery and obstruction charges, alleging they worked to bribe grocery store alcohol buyers and conceal the bribes with falsified financial documentation. A salesman for a Napa winery was also accused of bribing the head alcohol buyer for a large national grocery store chain.
Last year, a wine buyer for Albertsons was charged with commercial bribery and conspiracy for allegedly accepting lavish vacations, luxury watches, gift cards and other bribes in exchange for carrying certain wines. Two executives at wine supplier Deutsch Family Wine & Spirits who provided kickbacks to that wine buyer pleaded guilty to commercial bribery in a scheme worth $360,000.
Times staff writer Suhauna Hussain contributed to this report.
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