Deere & Co., the world's largest manufacturer of farm equipment, is under investigation by the Securities and Exchange Commission for possible violations of the foreign bribery law, according to two people familiar with the matter.
The company received an inquiry from regulators last month regarding payments made in Russia and nearby countries, one person said. The probe is looking at whether the payments fell afoul of the Foreign Corrupt Practices Act, a 1977 law that bars companies from paying bribes to foreign officials.
An SEC spokesman declined to comment.
Deere said in a statement that the company received a voluntary request from the SEC on July 25 to produce documents relating to Deere's activities, as well as those of third parties, in "certain foreign countries."
"The SEC has informed Deere that this is a non-public fact-finding inquiry to determine whether there have been any violations of the federal securities laws, and that the inquiry and document request do not mean that the SEC has concluded that Deere has broken the law," the statement said.
The investigation of Moline, Ill.-based Deere, which also makes construction and forestry equipment, comes as the company is trying to seize on the growth of cities in the developing world and the need for more food production globally.
The company has more than 50,000 employees world-wide and reported a profit of $904.3 million for the quarter ended April 30.
Deere says it sees long-term growth potential in Russia, which has 9% of the world's arable land and is one of the world's top producers of wheat.
Siemens, which admitted to engaging in widespread bribery overseas, paid $1.6 billion in global settlement to resolve those allegations and others.
The H-P probe is ongoing. The company says it is cooperating with the Justice Department and SEC.
Deere is the latest company this year to come under scrutiny in a major ramp up in enforcement of the foreign bribery law. In recent months, the Justice Department and the SEC have brokered multi-million settlements with Johnson & Johnson, International Business Machines Corp. and Tyson Foods Inc., among others.
Johnson & Johnson and Tyson both admitted to criminal violations but neither admitted nor denied SEC charges. Under its settlement with the SEC, IBM neither admitted nor denied the agency's allegations.
In 2008, the Justice Department and SEC charged agricultural machinery company AGCO Corp. in a scheme to pay kickbacks to the government of Iraq in return for contracts with the country's Ministry of Agriculture. AGCO agreed to pay about $20 million to the U.S. government to resolve the case. The company acknowledged wrongdoing in its settlement with the Justice Department but neither admitted nor denied civil charges brought by the SEC.
In a related case, Italian auto company Fiat SpA agreed to pay $18 million on behalf of three of its subsidiaries, including agricultural equipment firm CNH Italia, which was accused of paying the Iraq government $1 million in kickbacks to land four contracts from the agriculture ministry. Fiat admitted criminal violations of FCPA but neither admitted nor denied SEC charges.