Facilitation payments: Lessons from a landmark case in the banana sector

 They were found guilty of aggravated conspiracy to commit a crime. The ruling revealed a deliberate and sustained financing scheme for paramilitary groups in the Urabá region. This funding was carried out through covert payments disguised as security contracts with Convivir cooperatives.

Between 1995 and 2004, the companies systematically deducted three cents per exported box of bananas, channeling those funds to illegal armed groups under the guise of protection services. This “facilitation payment” model evolved into a structure of transnational corruption with serious social, legal, and reputational impacts.

Key aspects from a compliance and business ethics perspective

From a compliance and business ethics standpoint, the case of the banana company shows how facilitation payments, often justified as operational costs, can become covert bribery mechanisms that fuel criminal networks. Although the amounts may seem minor, their repeated and concealed nature makes them clearly illegal under international frameworks such as the U.S. FCPA or the U.K. Bribery Act. Companies must identify and mitigate these risks within their compliance programs.

Another critical point is the use of legal fronts for illicit purposes. The cooperatives, although legally established, were instrumentalized to funnel funds to illegal armed groups. This highlights the corporate responsibility to conduct effective due diligence on third parties, as failure to verify the destination of funds constitutes a serious lapse that may lead to bribery laundering schemes.

The court ruling also clarified that there was no coercion or extortion: the payments were deliberate decisions made by executives with the legal and economic capacity to act differently. The lack of reporting and the absence of timely institutional response reflect an organizational culture permissive of corruption, aggravating the company’s ethical and legal liability.

The impact of these actions goes beyond the economic realm. The money ended up funding the purchase of weapons and enabling serious human rights violations by the AUC. Thus, the case is not merely a corruption scandal; it is a stark example of how poor corporate practices can directly contribute to heinous crimes.

Finally, this case offers powerful lessons for preventing transnational bribery. The lack of effective internal controls and the pragmatic justification of payments in insecure contexts ultimately undermine corporate integrity, global reputation, and criminal liability in both local and international jurisdictions.

Reflections for the business sector and compliance officers

• Facilitation payments are not harmless: They are the first step toward complex corruption and criminal financing schemes.
• A legal fade does not eliminate responsibility: Every third-party relationship must undergo enhanced due diligence.
• Silence is also compromising: Failure to report or question irregular payments may be interpreted as acquiescence.
• Ethics are non-negotiable: Business sustainability depends on strong integrity structures, especially in high-risk areas.

Institutional recommendations

• Audit security, surveillance, and logistics contracts to detect potential misuse of resources.
• Strengthen training for management on the legal, reputational, and social risks of facilitation payments.
• Adopt international anti-corruption guidelines, such as the UN Guiding Principles, ISO 37001, and OECD recommendations.
• Design risk maps adapted to the Colombian context, including factors such as armed conflict, illegal economies, and institutional weakness.