A global engineering company settled DOJ and SEC charges for involvement in a bribery scheme to secure a contract with a Brazilian state-owned oil company.
In an information filed in the U.S. District Court for the Eastern District of New York, the DOJ charged the company with one count of conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act ("FCPA") by improperly paying foreign officials to win an approximately $190 million contract to design a gas-to-chemical complex in Brazil. The company entered into a three-year deferred-prosecution agreement with the DOJ and agreed to pay a monetary penalty of $18.375 million. According to the DOJ, and in accordance with the Department's FCPA Corporate Enforcement Policy, the penalty was reduced by 25% compared to the applicable U.S. Sentencing Guidelines fine due to the company's full cooperation and remediation. Approximately $10.7 million of the penalty may be offset against payments to the UK's Serious Fraud Office ("SFO") and Brazilian authorities in related resolutions.
In a related civil matter, the SEC charged the company with improper payments in the amount of approximately $1.1 million, including the use of a Monaco-based intermediary that had previously failed the company's due diligence process. The SEC alleged that the payments were not accurately reflected in the company's books and records, and that the company failed to have in place sufficient internal accounting controls to detect or prevent the misconduct. As a result, the SEC claimed that the company violated Sections 13(b)(2)(A), 13(b)(2)(B) and 30A ("Prohibited foreign trade practices by issuers") of the Exchange Act. To settle the charges, the company agreed to pay $22.7 million in disgorgement and prejudgment interest, $12.6 million of which may be offset against disgorgement paid by the company to the SFO and Brazilian authorities.
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