TechnipFMC and U.S. subsidiary to pay over $296 million to resolve foreign bribery caseChristian Fernsby ▼ | June 26, 2019
TechnipFMC and its wholly-owned U.S. subsidiary, Technip USA have agreed to pay a combined total criminal fine of more than $296 million to resolve foreign bribery charges with authorities in the United States and Brazil.
The charges arose out of two independent bribery schemes: a scheme by Technip to pay bribes to Brazilian officials and a scheme by FMC to pay bribes to officials in Iraq.
Technip USA and Technip’s former consultant pleaded guilty today in connection with the resolution.
In 2010, Technip entered into a $240 million resolution with the Department over bribes paid in Nigeria.
TFMC entered into a deferred prosecution agreement with the Department in connection with a criminal information filed today in the Eastern District of New York charging the company with two counts of conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA).
In addition, Technip USA pleaded guilty and was sentenced on a one-count criminal information charging it with conspiracy to violate the anti-bribery provisions of the FCPA.
Pursuant to its agreement with the Department, TechnipFMC will pay a total criminal fine of over $296 million, including a $500,000 criminal fine paid by Technip USA.
As part of the deferred prosecution agreement, TechnipFMC committed to implementing rigorous internal controls and to cooperate fully with the Department’s ongoing investigation.
In connection with the scheme to bribe Brazilian officials, Technip’s former consultant also pleaded guilty in the Eastern District of New York to a one-count criminal information charging him with conspiracy to violate the FCPA.
He is awaiting sentencing.
All three cases are assigned to U.S. District Judge Kiyo A. Matsumoto of the Eastern District of New York.
In related proceedings, the company settled with the Advogado-Geral da União (AGU), the Controladoria-Geral da União (CGU) and the Ministério Público Federal (MPF) in Brazil over bribes paid in Brazil.
The United States will credit the amount the company pays to the Brazilian authorities under their respective agreements, with TechnipFMC paying Brazil approximately $214 million in penalties.
According to admissions and court documents, beginning in at least 2003 and continuing until at least 2013, Technip conspired with others, including Singapore-based Keppel Offshore & Marine Ltd.
(KOM) and their former consultant, to violate the FCPA by making more than $69 million in corrupt payments and “commission payments” to the consultant, companies associated with the consultant and others, who passed along portions of these payments as bribes to Brazialin government officials who were employees at the Brazilian state-owned oil company, Petrobras, in order to secure improper business advantages and obtaining and retaining business with Petrobas for Technip, Technip USA and Joint Venture.
In addition, Technip made more than $6 million in corrupt payments to the Workers’ Party in Brazil and Workers’ party officials in furtherance of the bribery scheme.
The admissions and court documents also establish that beginning by at least 2008 and continuing until at least 2013, FMC conspired to violate the FCPA by paying bribes to at least seven government officials in Iraq, including officials at the Ministry of Oil, the South Oil Company and the Missan Oil Company, through a Monaco-based intermediary company in order to win secure improper business advantages and to influence those foreign officials to obtain and retain business for FMC Technologies in Iraq.
In the resolutions with the Department, TFMC received credit for its substantial cooperation with the Department’s investigation and for taking extensive remedial measures.
For example, the company separated from or took disciplinary action against former and current employees in relation to the misconduct described in the statement of facts to which it admitted as part of the resolution; made changes to its business operations in Brazil to no longer participate in the type of work where the misconduct at issue arose; required that certain employees and third parties undergo additional compliance training; and made specific enhancements to the company’s internal controls and compliance program.
Accordingly, the criminal fine reflects a 25 percent reduction off the applicable U.S. Sentencing Guidelines fine for the company’s full cooperation and remediation.
In a related enforcement action, in December of 2017, KOM and its U.S. subsidiary, Keppel Offshore & Marine USA, Inc., agreed to pay a combined total criminal fine of more than $422 million to resolve charges with authorities in the United States, Brazil and Singapore on related conduct.
A former senior member of KOM’s legal department also pleaded guilty and is awaiting sentencing. ■