On Monday, a US Senate panel released a report on the controversial Deepak Chemicals company, warning that the company is “likely to continue to operate” and that the agency’s current investigation could lead to criminal prosecution of its top executives.
The report, authored by Senator Chris Coons, also warned that the Trump administration may need to move fast to dismantle the company because the Justice Department has been unable to adequately investigate the company’s activities since the 2015 death of Deepak’s founder and CEO, Deepak Parekh.
The Senate panel’s report was released following an inquiry by the House panel into the death of Parek.
In the Senate panel report, the Justice department’s criminal division said that, after receiving “more than 100 credible reports” that Deepak was using “a variety of fraudulent and deceptive practices to generate billions of dollars in profits and evade its own internal controls,” it launched an investigation.
The criminal division has not made any arrests.
The department has since issued a series of directives to conduct “a thorough review of all documents” related to Parekan’s death.
The agency also has launched a review into the company and its activities.
While Deepak and Pareka were known to be close, the Senate report said the Justice report noted that Pareki, who founded Deepak in 2006, had been “actively cooperating” with the agency since the company began operations in 2008.
According to the report, in 2012, the department received an investigation from a different regulator into Deepak chemicals that involved “preliminary allegations” that the chemical company “may have engaged in deceptive conduct to gain market share in the face of an unfavorable environment for the company.”
The agency “had no basis to conclude that the allegations were substantiated, and the investigation has since been closed,” the report said.
According in the report that was released Monday, the agency said it “is confident” that “a full investigation” would uncover “no wrongdoing on the part of Deepaks senior management.”
However, the investigation into Deepaks activities was “committed in a manner that was both politically motivated and inconsistent with its stated policies and objectives,” the agency wrote in its report.
Parekh died of a heart attack at his home in December 2015.
The investigation into his death has been under way for more than two years, with the Justice and Commerce Departments investigating Deepak for possible civil and criminal violations of the Sarbanes-Oxley Act.
In a statement released Monday morning, Deepaks parent company, BASF, said the report was “a very disappointing report on a company that has a long history of misconduct and abuses.”BASF also noted that the Senate probe had already concluded and that “the department has made a thorough investigation” and is now “reviewing all of the relevant documents related to the death.”
Basf also noted, however, that it “has not yet received any information or evidence that the department will pursue any civil or criminal prosecution against any Deepak employees.”Read more: