Key Energy Services’ recent SEC settlement resolving internal controls and books and records charges once again highlights the dangers of failing to supervise foreign subsidiaries. The company agreed to disgorge $5 million to resolve charges that it violated the FCPA when a consultant working on behalf of its Mexican subsidiary allegedly made improper payments to an employee of Mexico’s state-owned oil company, Petroleos Mexicanos, commonly known as Pemex. Key Energy previously announced that the DOJ declined to prosecute it based on the same conduct. Despite significant evidence of wrongdoing, the company avoided a civil penalty due to its precarious financial condition, significant remediation efforts and its imminent exit from the Mexican market. See also “Could Johnson Controls Have Prevented the Flagrant Circumvention of Its Revamped Compliance Program?” (Jul. 27, 2016).