Colombia sues Diageo over 'bribes'

DRINKS giant Diageo has been hit with a massive lawsuit by the government of Colombia for allegedly threatening its national security by dealing with known terrorists, money launderers and drug traffickers.

The suit, filed in a New York court under America's draconian racketeering laws, seeks unspecified damages from distribution activities that it is claimed netted Diageo 'hundreds of millions of dollars a year'.

It is not clear whether other drinks companies trading in Colombia have also been targeted.

The company, which has not received a copy of the lawsuit nor told shareholders of the action, called the allegations 'absolutely false' and said it would fight the claims 'with all means at our disposal'.

Colombia's 184-page complaint said that from 1990, the activities undermined its efforts to control the liquor trade, drug trafficking and terrorism and threatened the underpinnings of the country, including its currency.

'The defendants created a circuitous and clandestine distribution chain to sell their liquor to criminal organisations and receive payment for their products,' said the lawsuit.

The lawsuit claims that employees of Diageo, which sells brands including-Jose Cuervo, Dom Perignon, Johnnie Walker, Smirnoff and Baileys in Latin America, paid 'bribes to ensure that their passports were not marked as to reflect that they had entered Colombia'.

Diageo said that far from acting illegally in Colombia, it had voluntarily worked with Bogota to enhance customs enforcement and help prevent the illegal trade in liquor.

William Bullard, the company's Corporate Relations Director for Latin America, said: 'Diageo is very proud to responsibly market and sell its brands in Colombia and vigorously adheres to the laws and regulations in the countries where our brands are sold.'